Reference no: EM132612515

Question 1: Defined benefit plan that specifies annual retirement benefits equal to Set % X Service Years X Final Year's Salary asked to develop a model that will calculate the Service Cost, Interest and Projected Benefit Obligation at the end of each year for one employee. PBO increases each year for service cost and interest. After retirement, benefits are paid and PBO is reduced. the model should be flexible, but you can have it set for a maximum number of years. To test your model, you should make up assumptions. For example, you expect to retire in 40 years after 40 years of service. You expect to live 20 years after retirement. You expect your salary to be $200,000 your final year of work and the set % is 1%. The settlement rate (discount rate) is estimated to be 4%.