BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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house excess cash until needed.
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generate earnings.
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meet strategic goals.
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avoid a takeover by disgruntled investors.
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Detailed explanation-1: -Essentially, a pension fund is a long-term, tax-efficient savings plan that you can access in later life when you want to work less or retire. Pension funds are made up of a portfolio of assets in which your pension contributions are invested, such as stocks and shares, bonds, cash and commercial property.
Detailed explanation-2: -Debt funds invest in either listed or unlisted debt instruments, such as Corporate and Government Bonds at a certain price and later sell them at a margin. The difference between the cost and sale price accounts for the appreciation or depreciation in the fund’s net asset value (NAV).
Detailed explanation-3: -Pension funds collect money from employers and employees to fund employee retirement obligations. Pension fund providers look to long-term growth of capital to support the needs of future retirees as the cost of living increases over their working lives.
Detailed explanation-4: -If you have a defined contribution pension (most pension savers do), then your monthly contributions are paid into a fund that invests in the stock market. This fund usually achieves growth over the long term, but in the short-to-mid term its value can fluctuate wildly due to ‘booms and busts’.