Chapter 13 - Benefit Options

17. (p. 465) Steve has a small company with 12 employees. One of his employees, Larry, has

been laid off because his work has been outsourced. Larry had health coverage through Steve's

company and he wants to continue that coverage after being laid off. According to C.O.B.R.A.

how long can Larry continue his coverage through Steve's Company? 

A. 

36 months

B. 

24 months

C. 

18 months

D.

 0 months

Difficulty: Medium

 

18. (p. 465) Which of the following acts has caused HR and information technology staff

considerable difficulty regarding compliance and privacy? 

A. 

COBRA

B.

 HIPPA

C. 

FMLA

D. 

ERISA

 

Difficulty: Medium

 

19. (p. 465) _____ was designed to reduce an employer's ability to deny coverage to an employee

based upon a preexisting condition. 

A. 

COBRA

B. 

OSHA

C.

 HIPPA

D. 

FMLA

Difficulty: Medium

 

20. (p. 465) Today, _____ percent of the workforce is covered under the pension plan coverage

by their employers. 

A. 

sixty-four

B. 

fifty-eight

C. 

fifty-six

D.

 forty-nine

Difficulty: Difficult

 

13-5

© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any

manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.

Chapter 13 - Benefit Options

21. (p. 466) The majority of defined benefit plans calculate average earnings over the last _____

years of service for a prospective retiree. 

A. 

2 to 4

B.

 3 to 5

C. 

6 to 8

D. 

7 to 9

Difficulty: Medium

 

22. (p. 466) In a _____ plan an employer agrees to provide a specific level of retirement pension,

which is expressed as either a fixed dollar or a percentage-of-earnings amount that may vary

(increase) with years of seniority in the company. 

A.

 defined benefit

B. 

noncontributory benefit

C. 

401 (k)

D. 

shared-benefit

Difficulty: Difficult

 

23. (p. 466) Employer advantages of defined contribution plans versus defined benefit plans

include all of the following except: 

A. 

vesting is usually faster.

B.

 pre-retirement contributions are smaller.

C. 

pension costs are more predictable.

D. 

employee mobility is facilitated.

Difficulty: Medium

 

24. (p. 467) Which of the following is not a defined contribution plan? 

A. 

401 K

B. 

ESOP

C.

 Cash-back

D. 

Profit sharing

Difficulty: Medium

 

13-6

© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any

manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.