Which of the Following Is True Concerning Employer Funding of Nonqualified

question 51

Multiple Choice

Which of the following is true concerning employer funding of nonqualified deferred compensation plans?

• A)Employers are required to invest salary deferred by employees in investments specified by the employees.
• B)Employers are required to annually fund their deferred compensation obligations to employees.
• C)Employers annually deduct the amount earned by employees under the plan.
• D)Employers may discriminate in terms of who they allow to participate in the plan.See discussion of nonqualified deferred compensation plans in the text.

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Definitions:

Systematic Risk

A type of risk that affects all securities in a market or market segment, unable to be lessened through diversification.

Influences

Factors or forces that have an effect on the outcomes or behaviors in a situation.

Assets

Assets refer to resources owned or controlled by a person or business with economic value and expected to provide future benefits.

Market Risk

Market risk refers to the potential for an investor to experience losses due to factors that affect the overall performance of the financial markets.