A defined benefit pension plan expects to pay out $25 million per year over the next 10 years to pensioners. The fund currently has $155 million in pension assets that are earning 10 percent per year. This plan is underfunded.

Question

Quizplus · Accepted Answer

Given the fund earns 10 percent per year, the future value of the current assets exceeds the total expected payouts over the next 10 years, indicating the plan is not underfunded.

A Defined Benefit Pension Plan Expects to Pay Out $25