Regarding the Pension Benefit Guarantee Corporation (PBGC), which of the following statements is true? The PBGC...
Regarding the Pension Benefit Guarantee Corporation (PBGC), which of the following statements is true?
The PBGC is an agency that insures undefined pension plans.
The PBGC is an agency that insures defined contribution pension plans.
The PBGC's fund is running out of money, due to the increase in the failure of the pension plans it insures.
The PBGC has run out of money and has been disbanded
Homework Answers
Right answer: The PBGC's fund is running out of money, due to the increase in the failure of the pension plans it insures.
Explanation:
The PBGC is an agency that insures the pension plans that are defined and not undefined. Hence option 1 is false.
The PBGC is an agency that insures defined benefit and not contribution pension plans. Hence option 2 is also false.
The PBGC's fund is running out of money, due to the increase in the failure of the pension plans it insures. This is true. This is true because many of the plans of both multi-employer as well as single-employer plans of PBGC is suffering the deficits.
The PBGC is in the state of running out of money but has not completely run out of money and neither has it been disbanded. Hence this option is also false.
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