Defined-benefit plans:
A) are more common than defined contribution plans.
B) pay a pension based on the amount contributed into the plan by the employee and employer.
C) do not require any responsibility on the part of the employer for the employees' retirement income; it is based on employee contributions.
D) usually require an employee to work a very long time for the same employer in order to reap a large benefit.

Question

Quizplus · Accepted Answer

Defined-benefit plans typically require employees to work for a longer period of time in order to receive a larger benefit. These plans pay out a pension based on factors such as salary and years of service, and the responsibility for funding the pension falls mainly on the employer. Defined contribution plans, on the other hand, are more common and pay out a benefit based on contributions made by both the employee and employer.

Defined-Benefit Plans