2014CFA3级-每日一练-R15-20140320

whereas, company, function, insurance, employees

The liquidity requirements of a pension fund differ from the liquidity requirements of a life insurance company in that the liquidity requirements of a pension fund:

A) will be dictated by state statutes, whereas the liquidity requirements of a life insurance company will be dictated by federal statute.

B) will be a direct function of the age of employees and the retired-lives portion of participants, whereas the liquidity requirements of a life insurance company will be a function of the liability requirements of products sold.

C) and the liquidity requirements of an insurance company will be dictated by federal statute.

solution：B

Pension fund liquidity is often dictated by the age of employees and the retired-lives portion of participants. Life insurance companies, on the other hand, will have liquidity requirements that are generated by the differential products sold to policy holders.