The correct answer is: B. downsizing of US companies.
Pension funds are a type of retirement savings plan that is sponsored by an employer. They are funded by contributions from both the employer and the employee, and they provide a guaranteed income stream in retirement.
The importance of pension funds has declined in recent years due to a number of factors, including the downsizing of US companies. As companies have downsized, they have often eliminated their pension plans, leaving employees to save for retirement on their own. This has led to a decline in the number of people who have access to a pension, and it has also made it more difficult for people to save enough for retirement.
The other options are not as important reasons for the decline of pension funds. Option A, decrease in pension benefits for workers, is a factor that has contributed to the decline of pension funds, but it is not the most important factor. Option C, large number of conversions into self-directed plans, is a relatively new trend that has not had a significant impact on the decline of pension funds. Option D, increasing number of federal regulations that restrict pension fund portfolios, is a factor that has made it more difficult for pension funds to manage their investments, but it is not the most important factor.
In conclusion, the most important reason for the decline of pension funds is the downsizing of US companies. This has led to a decline in the number of people who have access to a pension, and it has also made it more difficult for people to save enough for retirement.