Problem

Financial Bank Inc. offers its employees a pension program with the following design:

The base retirement age is 65.

Employees can retire up to 5 years early with a 2% reduction in benefit for each year.

Employees can work an additional five years for a 1.5% increase in benefit (not subject to the maximum) for each additional year worked.

The benefits are based off of the average of the three highest salaries earned during their careers.

Employees receive 3% of their salary per year worked up to a 66% maximum.

Find the benefit earned by the following employees:

a.Adam, aged 65, worked for the company for 22 years. Average of his last three-years of salary: $63,000.

b.Bridget, age 62, worked for the company for 19 years. Average of his last three-years of salary:$72,000.

c.Camille, aged 68, worked for the company for 31 years. Average of his last three-years of salary:$45,000

Problem

Realty Development contributes to its employees 401(k) based on the following design: it matches its employee’s

contributions dollar-for-dollar up to 6% of their salary. Find the total contributions made to the retirement account for

the following employees during a one-year period:

a.Delwyn earned $62,000 per year and contributes 0% of his salary to his retirement account.

b.Eugene earned $49,200 per year and contributes 5% of his salary to his retirement account.

c.Felicity earned $71,500 per year and contributes 8% of her salary to her retirement account.