Estimating qualified plan

An employer wishes to establish a qualified plan in which the annual contribution is a percentage of each participant's compensation. The work force is large, middle-income and mostly young to middle aged. Assuming one of the employer's primary goals for the retirement plan is to assure the security of retirement income by providing a plan guaranteed by the PBGC, which of the following types of plans would be the first recommendation?

A. a cash balance pension plan
B. a defined benefit plan
C. a 401(k) plan


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Finance Basics: Estimating qualified plan
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