1) An individual whose average three highest consecutive years of compensation is $130,000 will have a maximum benefit payable at retirement from their defined benefit pension plan of $220,000 (2018) per year.

Question 1 options:

	a) True
	b) False

2) A defined benefit pension plan, which uses a flat-amount formula, pays each participant the same dollar amount during their retirement.

Question 2 options:

	a) True
	b) False

3) Which of the following statements is/are correct?

1. A cash balance pension plan maintains separate accounts for each of its participants as illustrated in the participants plan statements. 2. Within a defined benefit pension plan, the participants accrued benefit at any point is the participants present account balance.

Question 3 options:

a)

1 Only

b)

2 Only

c)	Both 1 and 2

d)	Neither 1 nor 2

4) Which of the following statements is/are correct?

1. If a participant terminates service with a defined benefit pension plan sponsor before becoming 100% vested, the participants forfeitures may be allocated to the other participants of the defined benefit pension plan. 2. The aggregate cost of a term life insurance policy included in a defined contribution plan cannot exceed 25% of the value of the defined contribution plan assets.

Question 4 options:

a)

2 Only

b)

1 Only

c)	Both 1 and 2

d)	Neither 1 nor 2

5) Each of the following is a characteristic of a defined benefit retirement plan EXCEPT:

Question 5 options:

a)	The plan specifies the benefit an employee receives at retirement.

b)	The law specifies the maximum allowable benefit payable from the plan is equal to the lesser of 100% of salary or $220,000 (2018) per year currently.

c)	The plan has less predictable costs as compared to defined contribution plans.

d)	The plan assigns the risk of pre-retirement inflation, investment performance, and adequacy of retirement income to the employee.