Which of the Following Is True of 401(k)plans

question 47

Multiple Choice

Which of the following is true of 401(k) plans?

• A) They refer to the leave policies which make no distinction between sick,vacation,and personal days and allow employees a set number of days off each year.
• B) They are compensation plans which take no more than 3 percent of the annual personnel budget.
• C) They allow the employee to have no control over the amount of their contribution and how the money is invested.
• D) They are typically easier to administer and are less expensive than traditional pension plans.

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Definitions:

Creditor

An individual or entity to whom money is owed by a debtor.

Security Interest

A legal claim on assets granted to a creditor to secure a debt or obligation, providing the right to take property upon failure to repay.

Contribution

The right of insurers (more than one) to share a loss where the policies so provide.

Insurers

Companies or entities that provide insurance coverage to individuals, businesses, or other organizations in exchange for premiums.