Which of the following is a commonly used employer-sponsored retirement plan design?

Question

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Defined contribution plans, such as 401(k) plans, are commonly used employer-sponsored retirement plan designs. These plans allow employees to contribute a portion of their pre-tax income into an individual account, which is then invested in a variety of funds. The employer may also make contributions to the plan on behalf of the employee. At retirement, the employee will receive the value of the account, which is based on the contributions and investment returns.

Which of the Following Is a Commonly Used Employer-Sponsored Retirement