Chapter 22, Problem 4MCQ

To determine

The correct option when a nonprofit institution collects the savings of its members and invests those funds in a wide variety of assets to provide its members retirement benefit.

Answer to Problem 4MCQ

From the available options, the correct option is there is a pension fund.

Explanation of Solution

When a non-profit organization collects the saving of its members and then invest this saving in other assets so that it can provide a retirement benefit to its members, it will provide this benefit as a pension fund. Whereas, mutual funds, banks, loans, and life insurance companies are all financial systems that do not come under the non-profit organization.

Therefore, the correct option is d (pension fund) and all other options are incorrect.

Economics Concept Introduction

Introduction: A non-profit institution is an institution whose aim is not profit-making but to serve society or members of the organization.