Question 1 asks about the pension plan for CHM Corporation but in the reading, it indicates that “company employees participate in a defined contribution plan in which investments in the plan is participant directed”.
This doesn’t makes sense. Pension plan is NOT defined contribution plan.
If the item set writer intentionally put the word pension in the question, then it was designed to throw you off, which it seems it did. The important thing is identifying that the question is testing your knowledge of the difference between defined benefit and defined contribution plans.
But the wording is not incorrect. A defined contribution plan is a type of pension plan.