Answer: defined-benefit pension plan.

## Explanation This question tests knowledge of different types of pension plans. **Key Concepts:** 1. **Defined-Benefit Pension Plan:** In this type of plan, the employer promises to pay a specified monthly benefit to employees upon retirement. The benefit is typically based on factors such as salary history and years of service. The employer bears the investment risk and is obligated to make up any funding shortfalls. 2. **Defined-Contribution Pension Plan:** In this type of plan, the employer and/or employee make regular contributions to individual accounts. The retirement benefit depends on the investment performance of those contributions. The employee bears the investment risk, and there is no guaranteed benefit amount. 3. **Endowment:** This is a type of charitable gift or fund, typically for educational or nonprofit institutions, not a retirement benefit plan. **Analysis:** The question describes a company with "an obligation to pay a certain amount each month to each of its employees after they retire." This is the defining characteristic of a defined-benefit pension plan: - The company has an obligation (liability) - The payment amount is specified ("certain amount") - Payments occur monthly after retirement - The obligation is to employees In contrast, a defined-contribution plan has no such obligation - the company only has an obligation to make contributions, not to pay specific retirement benefits. **Correct Answer: B (defined-benefit pension plan)**

Author: LeetQuiz .