When calculating fixed retirement payments, it is important not to forget:
A) changes in flexible interest rates.
B) the decline in the payment's value due to inflation.
C) the increase in the payment's value due to inflation.
D) rates of return in other markets.
E) the price of tea in China.

Question

Quizplus · Accepted Answer

Inflation can significantly decrease the value of fixed retirement payments over time, so it is important to factor in inflation when calculating those payments. Flexible interest rates, rates of return in other markets, and the price of tea in China are not relevant to calculating fixed retirement payments.

When Calculating Fixed Retirement Payments, It Is Important Not to Forget