Question

As mentioned in the text, George Washington University offers a vesting plan in which the employer puts a set amount of money into retirement accounts for employees, even if the employee does not. This type of pension plan is called__________________.

A. defined benefit
B. contributory
C. defined contribution
D. noncontributory

Answer 1

The answer is noncontributory (option d)

Step-by-step explanation:

Noncontributory pension plan also known as benefit pension plan is a pension plan that is funded by the employer. In other words, the employer funds the retirement account of employees.

This kind of pension plan does not require employees to contribute to their pension. It is different from most pension plans where both employer and employee are mandated to make contributions to the employee retirement account.