CFA Practice Question

There are 520 practice questions for this study session.

CFA Practice Question

Which element is "defined" in a defined benefit pension plan?
A. Pay-in formula
B. Pay-out amount
C. Pay-out formula
Explanation: Accounting for defined benefit plans is complicated because only the pay-out formula, and not the pay-out amount, is known. The pay-in formula is specified in a defined contribution plan.

User Contributed Comments 2

User Comment
czar Formula is getting the pv from the actuarial rate which is estimated based on forecasted elements, like retirement pattern, age etc.
ashish100 Fuuuuuu...... I had it right the first time
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