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At Balpy Corporation, an employee's retirement plan is funded by takin

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At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 25 Mar 2014, 13:52
3
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A
B
C
D
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Question Stats:

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At Balpy Corporation, an employee's retirement plan is funded by taking a set percentage of the employee's wages and matching it with an equal amount, contributed by the corporation. Employees may choose to stop contributions at any time, or continue contributing until their employment is terminated. There is a $2,000 bonus, called an ORT bonus, for employees who stay at the corporation until retirement.

Which of the following is a conclusion that can be properly drawn from the statements above?


A) Employees of the Balpy Corporation who earn higher salaries will receive larger ORT bonuses for staying until retirement.

B) Employees of the Balpy Corporation who earn lower salaries will contribute a smaller percentage of their salaries to their retirement funds than will employees of the Balpy Corporation who earn higher salaries.

C) Of the Balpy employees who stay until retirement, those who earn lower salaries will receive an ORT bonus that is a larger percentage of their annual salaries than that received by employees with higher salaries.

D) Balpy employees who earn lower salaries will receive less money from their retirement plans than will Balpy employees who earn higher salaries.

E) The Balpy Corporation will benefit financially from hiring employees at high salaries and terminating their employment before the employees have worked for six months.
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 05 Apr 2014, 10:20
This should be an inference question rather than conclusion...
no answer choice is leading to any conclusion..
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 05 Apr 2014, 21:22
Hi, Could Someone explain Why the answer is C ?
not B or D ??

I choose option B because , an employee who earns lower wages typically contribute a smaller percentage of their salaries to their retirement funds than employees earning higher wages.

How can we conclude in C that employees who stay until retirement, those who earn lower salaries will receive an ORT bonus that is a larger percentage of their annual salaries than that received by employees with higher salaries.

Moderators please help..
Thanks in advance :)
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 05 Apr 2014, 21:50
dheeraj24 wrote:
Hi, Could Someone explain Why the answer is C ?
not B or D ??

I choose option B because , an employee who earns lower wages typically contribute a smaller percentage of their salaries to their retirement funds than employees earning higher wages.

How can we conclude in C that employees who stay until retirement, those who earn lower salaries will receive an ORT bonus that is a larger percentage of their annual salaries than that received by employees with higher salaries.

Moderators please help..
Thanks in advance :)



Assume that there are two employees. One earning $500 and the other $1000. The fixed percentage of contribution is say 12.5% from the organization and the employee.

B is ruled out as the percentage of income contribution is fixed and only the amount is lower.

D is ruled out as someone who is earning a higher wage might chose to abstain from contributing towards this retirement fund, which will entitle the person with the lower salary to receieve a greater retirement benefit.

Hope that helps.
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 05 Apr 2014, 22:49
Hi Mayank,

This is my understanding from your explanation.

As far as choice B is concerned , your are assuming that both lower wage and higher wage employees contribute a Similar percentage % (not same amount ) of their income. Hence option B ruled out.

In choice D, You are assuming what if the higher wage employees restrain from contributing , in that case lower wage employee earns more than higher wage employee from retirement plan. Hence option D ruled out.

My interpretation for choice is, so called 2000$ amount (called an ORT bonus) is larger percentage of the annual salaries of lower wage employees than for higher wage employees.

As per your example, Lower wage employee : 500$/annum
Higher wage employee : 1000$/annum.
Therefore 2000$ bonus is a larger percentage of annual salaries of lower wage employees than that of Higher wage employees.
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 05 Apr 2014, 23:31
goodyear2013 wrote:
At Balpy Corporation, an employee's retirement plan is funded by taking a set percentage of the employee's wages and matching it with an equal amount, contributed by the corporation. Employees may choose to stop contributions at any time, or continue contributing until their employment is terminated. There is a $2,000 bonus, called an ORT bonus, for employees who stay at the corporation until retirement.




KEY POINTS of the stimulus----
1. employee set % taken as contribution( as per his willingness) and equal amount added by corporation to it.........
2. if he continues full tenure $ 2000 given additionally....by corporation as ORT.


A) Employees of the Balpy Corporation who earn higher salaries will receive larger ORT bonuses for staying until retirement.ORT IS FIXED
B) Employees of the Balpy Corporation who earn lower salaries will contribute a smaller percentage of their salaries to their retirement funds than will employees of the Balpy Corporation who earn higher salaries.WE DONT KNOW HOW MANY MONTHS/ YERS ONE WILL CONTRIBUTE AND HOW MUCH THE CONTRIBUTION % IS FOR EACH PAY BAND OF EMPLOYEE
C) Of the Balpy employees who stay until retirement, those who earn lower salaries will receive an ORT bonus that is a larger percentage of their annual salaries than that received by employees with higher salaries. OF COURSE THAT IS CORRECT......O
D) Balpy employees who earn lower salaries will receive less money from their retirement plans than will Balpy employees who earn higher salaries.DEPENDS OF LOT OF FACTORS----HOW MUCH DURATION CONTRIBUTION DONE, HOW MUCH IS THE FIXED CONTRIBUTION % ETC
E) The Balpy Corporation will benefit financially from hiring employees at high salaries and terminating their employment before the employees have worked for six months.NO THOUGHT OF PROFIT TO FIRM IN THE STIMULUS
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 06 Apr 2014, 00:20
dheeraj24 wrote:
Hi Mayank,

This is my understanding from your explanation.

As far as choice B is concerned , your are assuming that both lower wage and higher wage employees contribute a Similar percentage % (not same amount ) of their income. Hence option B ruled out.

In choice D, You are assuming what if the higher wage employees restrain from contributing , in that case lower wage employee earns more than higher wage employee from retirement plan. Hence option D ruled out.

My interpretation for choice is, so called 2000$ amount (called an ORT bonus) is larger percentage of the annual salaries of lower wage employees than for higher wage employees.

As per your example, Lower wage employee : 500$/annum
Higher wage employee : 1000$/annum.
Therefore 2000$ bonus is a larger percentage of annual salaries of lower wage employees than that of Higher wage employees.


Now adding to the stories of the individuals earning $500 and $1000 we can see that $62.5 and $125 are deducted per month from their respective salaries towards contribution in this retirement plan. Let us say both of them are to retire in another 30 years and their salaries do not increase during this period. Now, they would have accumalated $1875 and $3750 in all. $2000 is indeed a larger percentage of $1875 than $3750.

Hope that helps.
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 15 May 2014, 10:21
I was trapped between B and C..but on closer look found that B actually goes against the information provided and says the % of funds is less for lower salaried when compared to higher salaried. The stimulus states, it is a set percentage..meaning all bands may be paying say 5 % of their salaries towards retirement funds, even if the employer adds an equal value, the % of funds contributed will not vary from lower salary to higher salary


C fits smugly

Consider lower salary: $20,000
Higher salary: $40,000
ORT is $2000
% of ORT for lower salaried = 2000 / 20000 = 0.1 = 10 %
% of ORT for higher salaried = 2000 / 40000 = 0.05 = 5 %
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 04 Jan 2016, 19:36
goodyear2013 wrote:
At Balpy Corporation, an employee's retirement plan is funded by taking a set percentage of the employee's wages and matching it with an equal amount, contributed by the corporation. Employees may choose to stop contributions at any time, or continue contributing until their employment is terminated. There is a $2,000 bonus, called an ORT bonus, for employees who stay at the corporation until retirement.


uh...took me just little over 3 minutes to crack this baby.

we can infer that those who have lower wages will receive 2k and those who have higher wages will receive 2k.
thus, those who have lower wages, 2k will be better motivation than for those who have higher wages.

Which of the following is a conclusion that can be properly drawn from the statements above?

A) Employees of the Balpy Corporation who earn higher salaries will receive larger ORT bonuses for staying until retirement.
ORT bonus is the same for all, 2k$. out

B) Employees of the Balpy Corporation who earn lower salaries will contribute a smaller percentage of their salaries to their retirement funds than will employees of the Balpy Corporation who earn higher salaries.
not true. the percentage is the same for all employees.

C) Of the Balpy employees who stay until retirement, those who earn lower salaries will receive an ORT bonus that is a larger percentage of their annual salaries than that received by employees with higher salaries.
actually, yes, 2k/smaller amount > 2k/bigger amount. good candidate for correct answer choice.

D) Balpy employees who earn lower salaries will receive less money from their retirement plans than will Balpy employees who earn higher salaries.
this one is tricky, and almost got me pick it as the answer choice. the factor that made me reconsider it is " Employees may choose to stop contributions at any time". this statement makes this answer choice suspicious.

E) The Balpy Corporation will benefit financially from hiring employees at high salaries and terminating their employment before the employees have worked for six months.
how? by paying high salaries? illogical.
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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New post 24 Mar 2017, 10:30
At Balpy Corporation, an employee's retirement plan is funded by taking a set percentage of the employee's wages and matching it with an equal amount, contributed by the corporation. Employees may choose to stop contributions at any time, or continue contributing until their employment is terminated. There is a $2,000 bonus, called an ORT bonus, for employees who stay at the corporation until retirement.

Main point is - ORT bonus is fixed at $2000.
so clearly C.


Which of the following is a conclusion that can be properly drawn from the statements above?

A) Employees of the Balpy Corporation who earn higher salaries will receive larger ORT bonuses for staying until retirement.
B) Employees of the Balpy Corporation who earn lower salaries will contribute a smaller percentage of their salaries to their retirement funds than will employees of the Balpy Corporation who earn higher salaries.
C) Of the Balpy employees who stay until retirement, those who earn lower salaries will receive an ORT bonus that is a larger percentage of their annual salaries than that received by employees with higher salaries.
correct.
D) Balpy employees who earn lower salaries will receive less money from their retirement plans than will Balpy employees who earn higher salaries.
E) The Balpy Corporation will benefit financially from hiring employees at high salaries and terminating their employment before the employees have worked for six months.
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Re: At Balpy Corporation, an employee's retirement plan is funded by takin  [#permalink]

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