Question Exam employee benefits

Exam employee benefits

1. Edward Marchand, the owner of Archway Manufacturing, provides on-site ATMs and dry cleaning
pick-up for his employees. Mr. Marchand is taking a _______ approach to employee benefit planning.
A. marketing research
B. collective bargaining
C. life-cycle
D. work/life
2. In most states, if an employee becomes involuntarily unemployed because of a layoff, how long does he
or she have before unemployment benefits run out?
A. 26 weeks
B. 20 weeks
C. 52 weeks
D. 39 weeks
3. Which one of the following statements describes an advantage of using a telephone system to
communicate information to employees regarding benefit plans?
A. Employees are able to get the information at a time that’s convenient for them.
B. The benefit planners don’t have to listen to criticisms about the benefit plan.
C. The lack of human interaction makes it easier for shy employees to make their benefit choices.
D. Telephone systems are easy to update with new-employee and new-dependent information.
4. The following choices describe four individuals at the time they became disabled. Which one of these
individuals meets the work requirements for receiving disability under Social Security?
A. Carolyn, a 31-year-old, worked for three consecutive years after her children were old enough to be in school.
B. Marilyn, a 24-year-old, has earned credits equal to four quarters of coverage.
C. Carlos, a 25-year-old blind man, is not yet fully insured under Social Security.
D. Ivan, a 23-year-old, has worked for two consecutive years at a job for which he earns $25,000 per year.
5. Which of the following approaches would be best for using marketing research to determine the benefits
that employees need?
A. Conduct a meeting with senior management to determine what benefit changes should be made.
B. Give employees questionnaires with open-ended questions so that they may express their concerns and opinions about the
benefit plan.
C. Conduct personal interviews with employees; then conduct a competitive analysis to determine what your competitors are
offering.
D. Conduct personal interviews with employees or have them complete questionnaires with closed-ended questions.
6. If you were laid off from your job and became temporarily disabled while still unemployed, which of the
following states would you hope to be living in?
A. Florida
B. New Jersey
C. Alabama
D. Ohio
7. Which one of the following objectives would be appropriate for an employer to use with the benefit plan
that he or she offers?
A. To implement an annual increase of 3 percent in the salary of management employees
B. To establish and maintain an employee benefit program that rewards the efforts of the employees
C. To establish a holiday bonus plan for the years 2003 and 2004
D. To provide Prudential medical insurance to all employees
8. What does the term pay-as-you-go mean in relation to the method by which Social Security pays
benefits?
A. Monthly premiums paid by all workers are used to pay benefits.
B. Taxes on current workers are used to pay benefits to current beneficiaries.
C. General revenues are used to pay Social Security benefits.
D. Taxes on the benefits of retired people are used to pay benefits to current beneficiaries.
9. Martin is a 63-year-old fully insured employee. How will his 65-year-old wife pay for her Part A
Medicare?
A. She will pay through the old age and survivors’ trust fund.
B. She will pay monthly premiums and will be supplemented from federal revenues.
C. She won’t have to pay for her Part A Medicare.
D. She will pay through a flat tax on income up to a certain amount.
10. The term primary insurance amount refers to the amount that
A. a dependent spouse receives at the age of 62.
B. a worker receives each month if he or she retires at full retirement age.
C. an employee must pay toward health insurance.
D. an employee must earn to become fully insured under Social Security.
11. Which one of the following statements is true for workers’ compensation laws?
A. Most state workers’ compensation laws cover agriculture workers and domestic employees.
B. Under the previously held standard of the fellow-servant doctrine, any evidence of a worker’s negligence would deny him or
her coverage for an on-the-job injury.
C. Workers’ compensation laws are generally based on the principle of liability without fault.
D. All states require employers to purchase workers’ compensation from an insurance company.
12. Which of the following important elements should be established before the benefit-planning process
begins?
A. Objectives
B. Surveys
C. Medical insurance rates
D. Outsourcing vendor bids
13. Joe, a 27-year-old man, was in a car accident in July 2003. He was paralyzed from the neck down and
is now in a wheelchair. Joe graduated from college in June 1999 and got his first job in July 1999, with an
annual salary of $20,000. Until the day of his accident, he continued to work for the same company,
receiving annual salary increases. Is Joe eligible for Social Security disability insurance? Why or why not?
A. No, Joe didn’t make enough money during his years of employment.
B. Yes, at the age of 27, Joe would need only three years of work credit to be eligible, and he has four years of work credit.
C. Yes, he’s currently insured because he has at least six quarters of coverage out of the last 13-quarter period.
D. No, Joe doesn’t have enough work credit because he didn’t begin his career until 1999.
14. Which one of the following methods is becoming the increasingly accepted method for determining
employee benefit needs?
A. Competitor analysis
B. Collectively bargained benefits
C. Marketing research
D. Employer perception of employee needs
15. Eligibility for Social Security benefits depends upon an individual’s credit for a minimum amount of
work under the program. What is this credit based upon?
A. Special savings requirements
B. Monthly premiums
C. Quarters of coverage
D. Earnings per year
16. At what age do disabled widows and widowers become eligible for Medicare Part A at no cost?
A. 30
B. 40
C. 60
D. 50
17. Of the following items, which accounts for the largest payroll deductions for employees?
A. Educational assistance
B. Medical insurance
C. Social Security and Medicare taxes
D. Life insurance
End of exam
18. The main objective of unemployment insurance is to
A. provide temporary monetary assistance for individuals who are involuntarily out of work.
B. assist an employer in acquiring appropriate personnel in times of need.
C. assist the federal government in tracking the unemployment rate.
D. provide funding to the Social Security and Medicare programs.
19. Which one of the following statements is true regarding the Social Security and Medicare reserve trust
funds?
A. Both funds are sufficient for providing coverage up to and well beyond 2040.
B. The reserves in these funds are relatively small.
C. It’s illegal for the U.S. Treasury to borrow from these funds to cover government deficits.
D. The funds remain adequate due to increased payroll taxes.
20. With respect to communicating employee benefits, which one of the following devices is federally
mandated?
A. Face-to-face meetings with employees to be sure everyone understands the plan
B. Disclosure provisions of the Employee Retirement Income Security Act
C. Computer access for each employee to retrieve benefit information 24 hours a day
D. Written communication explaining in-depth the benefit plan
21. If an employer wants to provide life insurance as a benefit but can’t afford to offer a large amount,
which of the following contract provisions would that employer probably use?
A. Combination benefit schedule

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