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Use the following information for question 15. Terraria Constructions, Inc. offers a pension plan to its...

Use the following information for question 15. Terraria Constructions, Inc. offers a pension plan to its employees with a pension formula of 1.25%*Years of Service*Final Year’s Salary. Suzanne has been working for Terraria for 12 years. The corporate actuaries expect her to retire in 18 more years with a final salary of $425,000 and for her retirement period to last for 20 years. Her current salary is $175,000. The actuary’s discount rate is 7%.

15. What is projected benefit obligation (PBO) for Suzanne’s pension?

a. $82,277.65.

b. $199,817.14

c. $299,871.65.

d. $499,542.86.

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