Citizenship and Heritage Studies – SS1 – Concept of Pension (Questions with Answers and Explanations)

A pension is best defined as

A. a loan given to workers by their employers
B. the salary paid to a worker during active service
C. a tax paid to the government by retired persons
D. a regular payment made to a person after retirement

Under a defined benefit scheme, the risk of finding enough money to pay pensions is borne by the

A. worker alone
B. Pension Fund Custodian
C. retiree's children
D. employer or government

In a defined contribution plan, the thing that is fixed is the

A. amount contributed
B. final benefit paid at retirement
C. rate of investment returns
D. profit made by the employer