nan Ch.13 Full Test Bank Managing Benefits - HR Management People Data & Analytics 1e | Test Bank by Talya Bauer by Talya Bauer. DOCX document preview.
Test Bank
Multiple Choice
1. ______ include programs, services, and perquisites related to health care, retirement, work–life balance, and income protection.
A. Traditional pay
B. Benefits
C. Bonuses
D. Pay-for-performance programs
KEY: Learning Objective: 13.1: Understand how benefits act as rewards and support organizational strategy.
REF: Cognitive Domain: Knowledge
Answer Location: Opening Case Providing Benefits to Gig Workers at Care.com
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
2. On average, employee benefits cost ______ of total compensation.
A. one fourth
B. one third
C. one half
D. two third
KEY: Learning Objective: 13.1: Understand how benefits act as rewards and support organizational strategy.
REF: Cognitive Domain: Knowledge
Answer Location: Benefits as Rewards
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
3. Which two are considered the most common forms of voluntary benefits?
A. retirement and medical
B. medical and profit sharing
C. paid time off and retirement
D. medical and paid time off
KEY: Learning Objective: 13.1: Understand how benefits act as rewards and support organizational strategy.
REF: Cognitive Domain: Comprehension
Answer Location: Benefits as Rewards
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
4. Much like forms of direct pay, ______ benefits can be used to develop a strong workforce.
A. voluntary
B. Social Security
C. Medicare
D. disability income
KEY: Learning Objective: 13.1: Understand how benefits act as rewards and support organizational strategy.
REF: Cognitive Domain: Comprehension
Answer Location: Benefits as Rewards
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
5. Payroll taxes for unemployment insurance are funded by ______.
A. the employee
B. the Department of Labor
C. the employer
D. workers’ compensation
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Comprehension
Answer Location: Legally Required Benefits
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
6. What benefits are employers legally required to provide?
A. Social Security, workers’ compensation, unemployment insurance, and family and medical leave
B. work–life program, workers’ compensation, managed care plan, and wellness program
C. Social Security, wellness program, managed care plan, and unemployment insurance
D. unemployment insurance, managed care plan, family and medical, and wellness program
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Analysis
Answer Location: Legally Required Benefits
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
7. Both employer and employee are responsible for paying a set percentage of the employee’s earnings. What is the name of this payroll tax?
A. Federal Insurance Contributions Act withholdings
B. Family Medical Leave Act withholdings
C. Employee Retirement Income Security Act withholdings
D. Consolidated Omnibus Budget Reconciliation Act withholdings
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Comprehension
Answer Location: Social Security
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
8. In 1935, the U.S. Congress passed the ______ which originally focused on the provision of economic security for old-age individuals but now includes additional programs for mothers and children in need, for individuals with disabilities, for those who are unemployed, and for those whose family members have died.
A. Social Security Act
B. Federal Insurance Contributions Act
C. Family Medical Leave Act
D. Employee Retirement Income Security Act
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Social Security
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
9. Employers are required to contribute specific amounts to ______.
A. a simple 401(k) plan
B. Social Security
C. an employee stock ownership plan
D. a 403(b) plan
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Profit Sharing
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
10. In 1935, the U.S. Congress passed the ______ to help assist individuals recovering from the Great Depression.
A. Consolidated Omnibus Budget Reconciliation Act
B. Employee Retirement Income Security Act
C. Family Medical Leave Act
D. Social Security Act
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Comprehension
Answer Location: Social Security
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
11. What does FICA stand for?
A. Federal Insurance Compensation Act
B. Federal Insurance Comprehension Act
C. Federal Insurance Contributions Act
D. Federal Insurance Containment Act
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Social Security
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
12. Juan is thinking of retiring this winter when he turns 64 years old. He has earned more than 40 work credits and has applied for Social Security retirement benefits. If Juan retires at 64, how will his ability to collect Social Security benefits be affected?
A. He will be able to collect full Social Security retirement income when he retires.
B. He will only be able to collect reduced Social Security retirement benefits until he reaches age 67 and then full retirement benefits for the rest of his life.
C. He will be able to collect permanently reduced Social Security retirement benefits when he retires.
D. He will not be eligible for Social Security retirement benefits because he will not retire at 67 years old.
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Analysis
Answer Location: Retirement Income
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
13. George is hoping to retire early but is unsure if he has earned enough credits. Which example explains the earliest age he can retire with Social Security benefits and the number of credits he needs?
A. any age as long as he has 40 credits
B. 62 and 40 credits
C. 65 and 40 credits
D. 67 and 40 credits
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Application
Answer Location: Retirement Income
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
14. At what age are most Americans eligible for full retirement benefits in the United States?
A. 66–67
B. 61–62
C. 64–65
D. 60–61
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Retirement Income
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
15. Trevor’s wife Janine, who was eligible for Social Security benefits, passed away. What type of benefit is Trevor entitled to collect?
A. disability
B. survivor
C. workers’ compensation
D. retirement
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Application
Answer Location: Survivor Benefits
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
16. Friedrich’s adult son was recently diagnosed with a mental disorder that makes it difficult for him to maintain employment. Friedrich receives disability benefits through his employment. What would Friedrich need to prove in order for his son to qualify for Friedrich’s disability benefits?
A. that his son was diagnosed with his disability while on the job
B. that his son had accrued the requisite number of work credits
C. that his son developed the mental disorder before age 22
D. that his son had sufficiently contributed to his FICA withholdings
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Analysis
Answer Location: Disability Income
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
17. On what is an individual’s eligibility for Social Security disability based?
A. age, work credits, and age they first experienced the disability
B. work credits, the severity of the disability, and age they first experienced the disability
C. age, the severity of the disability, and age they first experienced the disability
D. attainment of age 21, work credits, and the severity of the disability
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Disability Income
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
18. Individuals may collect disability until they reach full retirement age, at which time they will receive ______.
A. life insurance benefits
B. unemployment benefits
C. workers’ compensation
D. retirement benefits
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Comprehension
Answer Location: Disability Income
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
19. ______ typically provides medical coverage, including rehabilitation services, and income replacement for an individual who was injured or fell ill due to accidents or hazards at work.
A. Workers’ compensation
B. Sick leave
C. Paid time off
D. Health insurance
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Workers’ Compensation
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
20. Which program is funded entirely by the employer in the form of payroll taxes?
A. health-care benefits
B. workers’ compensation
C. retirement benefits
D. life insurance benefits
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Comprehension
Answer Location: Workers’ Compensation
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
21. Eugene injured his lower back moving boxes to the store room at work. Which benefit program would Eugene use for medical care?
A. work–life program
B. workers’ compensation
C. managed care plan
D. wellness program
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Application
Answer Location: Workers’ Compensation
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
22. In what way is workers’ compensation similar to unemployment insurance?
A. both are legally required benefits
B. both pay out when the employee is laid off
C. both are voluntary benefits
D. both pay out when the employee is hurt on the job
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Analysis
Answer Location: Workers’ Compensation
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
23. Samuel lost his job at the crayon factory after 30 years. He does not know where to begin to find a new job. What type of benefit would Samuel apply for to assist him?
A. retirement income
B. disability income
C. workers’ compensation
D. unemployment insurance
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Application
Answer Location: Unemployment Insurance
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
24. The ______ was introduced in 1993 to protect employees’ job security in instances in which they need to take unpaid leave due to family or medical issues.
A. Social Security Act
B. Federal Insurance Contributions Act
C. Family Medical Leave Act
D. Employee Retirement Income Security Act
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Family and Medical Leave
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
25. Ryan and his employer meet all of the criteria for Family Medical Leave Act. This means he can take ______ weeks of unpaid leave to care for his newborn without losing his job and health-care benefits.
A. 12
B. 18
C. 26
D. 30
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Family and Medical Leave
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
26. Jorge works in Sacramento, CA, at a very small satellite office of a nonprofit company based out of Washington, DC. He has worked there for the past 5 years. He wants to take some time off under the Family Medical Leave Act to care for his newborn child. Which condition of the Family Medical Leave Act is most likely to prevent Jorge from doing so?
A. The employer must have 50 or more employees.
B. The employee must have worked at least 1,250 hr for their employer for at least 12 months.
C. The employee must work at an employer’s location that has at least 50 employees working within a 75-mile radius.
D. The employee must face at least one of a set of qualifying family medical challenges, such as pregnancy complications.
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Analysis
Answer Location: Family and Medical Leave
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
27. The ______ of 1974 set minimum standards for many private employers’ health-care plans.
A. Social Security Act
B. Federal Insurance Contributions Act
C. Family Medical Leave Act
D. Employee Retirement Income Security Act
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Additional Health Care Requirements
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
28. What does ERISA stand for?
A. Employee Retirement Income Security Act
B. Employee Reconciliation Income Security Act
C. Employee Requirement Income Security Act
D. Employer Retirement Income Security Act
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Additional Health Care Requirements
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
29. The ______ of 1996 adds protections to the portability of employees’ health-care coverage as well as protections to ensure the privacy and security of employees’ health-care data.
A. Consolidated Omnibus Budget Reconciliation Act
B. Family Medical Leave Act
C. Health Insurance Portability and Accountability Act
D. Patient Protection and Affordable Care Act
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Additional Health Care Requirements
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
30. Before Greg’s doctor’s appointment, the receptionist asks for his insurance card and asks him to sign a form that explains what the provider will do to protect him from discrimination. What law does this form outline?
A. Family Medical Leave Act
B. Federal Insurance Contributions Act
C. Health Insurance Portability and Accountability Act
D. Employee Benefits Security Administration
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Application
Answer Location: Additional Health Care Requirements
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
31. The ______ of 1985 protects employees’ (and their beneficiaries’) health-care coverage for a designated amount of time in the event of voluntary or involuntary job loss, work-hour reductions, or another major occurrence.
A. Consolidated Omnibus Budget Reconciliation Act
B. Family Medical Leave Act
C. Health Insurance Portability and Accountability Act
D. Patient Protection and Affordable Care Act
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Additional Health Care Requirements
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
32. Affordable health care for individuals, increased health-care coverage, and improved quality of care are all parts of the ______.
A. Federal Insurance Compensation Act
B. Patient Protection and Affordable Care Act
C. Pension Benefit Guaranty Corporation
D. Family and Medical Leave Act
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Additional Health Care Requirements
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
33. The ______ of 2010 offers rights and protections associated with access to health-care coverage.
A. Consolidated Omnibus Budget Reconciliation Act
B. Family Medical Leave Act
C. Health Insurance Portability and Accountability Act
D. Patient Protection and Affordable Care Act
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Additional Health Care Requirements
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
34. The ______ is commonly called Obamacare.
A. Consolidated Omnibus Budget Reconciliation Act
B. Family Medical Leave Act
C. Health Insurance Portability and Accountability Act
D. Patient Protection and Affordable Care Act
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Additional Health Care Requirements
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
35. Medical plans with higher deductibles have lower premiums than other plans. They also have ______.
A. reduced health coverage
B. higher out-of-pocket expenses
C. reduced prescription medication coverage
D. a higher maximum plan limit
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Medical Plans
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
36. ______ plans allow participants to select any medical provider of their choosing without affecting how they are reimbursed and participants’ expenses are reimbursed as they are incurred.
A. Short-term care
B. Tax-deferred care
C. Managed-care
D. Traditional-care plans
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Traditional-Care Plans
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
37. Weldon is looking for a medical plan that will allow him the freedom to select a provider of his choice without affecting how he is reimbursed. What type of benefit plan is Weldon looking for?
A. health saving plan
B. traditional-care plan
C. managed-care plan
D. flexible benefit plan
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Traditional-Care Plans
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
38. Rhonda has a history of strep throat, which she sometimes contracts twice a year. Her doctor suggests that removing her tonsils might make her less susceptible to strep. This tonsillectomy would be an elective surgery. Rhonda is on a managed-care plan through her employer. What is she most likely to be required to do before getting the tonsillectomy?
A. find an out-of-network hospital that will do the surgery
B. make sure that she has reached her deductible
C. get a second opinion on the tonsillectomy
D. request reimbursement through her HSA
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Analysis
Answer Location: Traditional-Care Plans
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
39. ______ plans are preferable to traditional plans when it comes to meeting cost containment goals and managing the quality and use of medical services.
A. Short-term care
B. Tax-deferred care
C. Managed-care
D. Defined-care
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Managed-Care Plans
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
40. ______ participants incur lower cost sharing when they use in-network medical providers and services.
A. Short-term care
B. Tax-deferred care
C. Managed-care
D. Defined-care
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Managed-Care Plans
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
41. What types of managed-care plans require the selection of a primary care doctor?
A. Preferred-Provider Organization and Exclusive-Provider Organization
B. Exclusive-Provider Organization and Point-of-Service
C. Preferred-Provider Organization and Health Maintenance Organization
D. Health Maintenance Organization and Point-of-Service
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Managed-Care Plans
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
42. Aaron is developing a health savings option for his company’s employees. The plan Aaron has chosen would allow the company (and not the employee) to contribute unlimited funds to an account, such that the account reimburses the employee on a tax-free basis for qualified medical costs. Which option has Aaron chosen?
A. defined contribution account
B. a health flexible spending arrangement
C. a health reimbursement arrangement
D. a health savings account
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Application
Answer Location: Health Savings Option
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
43.______ is a form of income protection for employees who temporarily become unable to work as a result of injury, whether sustained at work or during their personal time.
A. Health care
B. Short-term disability insurance
C. Life insurance
D. Flexible benefits plan
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Disability Insurance Programs
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
44. When does long-term disability activate?
A. when the disability occurs
B. after the maximum time period
C. after short-term disability expires
D. after income protection benefits expire
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Application
Answer Location: Disability Insurance Programs
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
45. Pension Benefit Guaranty Corporation will step in as trustee when a ______ fails.
A. voluntary retirement plan
B. profit-sharing plan
C. flexible spending plan
D. health savings plan
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Retirement Programs
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
46. Which federal law sets standards for voluntary pension and health plans in private industries to protect employees?
A. Health Insurance Portability and Accountability Act
B. Employee Retirement Income Security Act
C. Family Medical Leave Act
D. Consolidated Omnibus Budget Reconciliation Act
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Retirement Programs
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
47. A ______ plan is paid over a fixed amount of time and has a preestablished benefit provided by the employer.
A. cash balance
B. defined benefit
C. defined contribution
D. 401(k)
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Defined-Benefit Plans
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
48. With a ______, the employer provides the employee with a predetermined benefit to be paid out over a fixed amount of time.
A. traditional pension plan
B. defined-contribution plan
C. 401(k)
D. cash balance plan
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Defined-Benefit Plans
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
49. A ______, sometimes referred to as a guaranteed account plan, is a type of defined-benefit plan.
A. defined contribution
B. tax deferred
C. defined benefit
D. cash balance
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Defined-Benefit plans
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
50. A ______ does not yield a preestablished benefit for the employee. Instead, it is predicated on employee and/or employer contributions to an investment fund.
A. defined contribution
B. tax deferred
C. defined benefit
D. cash balance
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Defined-Contribution Plans
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
51. An employee enrolled in a ______ makes contributions to an individual account in the form of deferred income. The employer may also be able to contribute to the employee’s plan.
A. profit-sharing plan
B. 401(k) or 403(b)
C. defined benefit
D. cash balance
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: 401(k) and 403(b) Plans
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
52. In what way is a 401(k) similar to a 403(b)?
A. Both are profit-sharing plans.
B. Both are retirement plans.
C. Both are employee stock ownership plans.
D. Both are money purchasing plans.
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Analysis
Answer Location: Defined-Contribution Plans
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
53. A cash balance plan is what type of plan?
A. defined-benefit plan
B. direct benefit plan
C. college savings plan
D. defined-contribution plan
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Defined-Benefit Plans
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
54. Louise has learned that her new employer offers a pay-for-performance program. The money that the company makes is distributed among the employees based on a discretionary formula. What kind of program does Louise’s company use?
A. a profit-sharing program
B. a life insurance program
C. an employee stock ownership program
D. a money-purchase program
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Application
Answer Location: Profit Sharing
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
55. Which benefit can double as a retirement program and a pay-for-performance program?
A. an employee stock ownership plan
B. a Roth IRA
C. a college savings plan
D. a traditional IRA
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Employee Stock Ownership Plan
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
56. Money-purchase plans are what type of voluntary benefit?
A. cash-balance plan
B. defined-contribution pan
C. defined benefit plan
D. profit-sharing plan
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Money-Purchase Plan
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
57. In the defined-contribution plan known as a ______, employers simply contribute a specified amount to each plan participant’s account.
A. profit sharing
B. employee stock ownership
C. money purchase
D. traditional IRA
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Money-Purchase Plan
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
58. A plan that allows individuals to make tax-deferred investments for retirement is a ______ plan.
A. flexible benefits plan
B. employee stock ownership
C. money-purchase
D. traditional IRA
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Individual Retirement Plans
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
59. In what way is a traditional IRA similar to a Roth IRA?
A. Both allow employee-only contributions toward retirement and tax advantages.
B. Both allow contributions toward retirement and tax advantages.
C. Both allow employer-only contributions toward retirement and tax advantages.
D. Both are considered a direct pay benefit.
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Analysis
Answer Location: Individual Retirement Plans
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
60. Which type of voluntary benefit program addresses issues such as weight loss, behavioral coaching, and smoking cessation?
A. direct benefit
B. work–life
C. managed care
D. wellness
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Wellness Programs
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
61. Employers offer employees incentives for participation in ______ programs that are associated with positive work and health outcomes.
A. life insurance
B. wellness
C. work–life
D. profit-sharing
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Wellness Programs
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
62. When an employer compensates employees for time away from work, it is most often under a ______ program.
A. compensatory time
B. paid time off
C. telecommuting
D. flextime
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Paid Time Off (PTO)
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
63. When an employee takes time off from work due to a personal health issue or an immediate family member’s health issue, it is referred to as ______.
A. flextime
B. paid time off
C. traditional care
D. sick leave
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Sick Time
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
64. Phyllis has the flu and is unable to return to work for several days. In order to cover her time off, Phyllis should most appropriately use ______.
A. personal leave
B. sick time
C. paid time off
D. compensatory time
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Application
Answer Location: Work-Life Programs
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
65. When employees take time off from work on a recognized federal, state, or local holiday, employers use ______ to compensate workers.
A. holiday pay
B. vacation pay
C. money-purchase plans
D. personal leave
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Holiday Pay
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
66. Nico works 3 days in the office, the other 2 days from home. This an example of ______.
A. compensatory time
B. flexible benefits
C. telecommuting
D. work–life program
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Application
Answer Location: Work-Life Programs
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
67. Which type of benefit is offered to supplement vacation time and sick time and is offered as paid or unpaid?
A. telecommuting
B. flextime
C. compensatory time
D. personal leave
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Personal Leave
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
68. Chelsea, a nonexempt, public-sector employee, is asked to work on a Saturday to help with customer service calls. She will work more than her usual 40 hr for the week. What is Chelsea entitled to if she does not receive overtime pay?
A. vacation pay
B. holiday pay
C. personal leave
D. compensatory time off
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Analysis
Answer Location: Compensatory Time Off
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
69. What are two forms of flexible work arrangements?
A. dependent care and telecommuting
B. telecommuting and flextime
C. flextime and eldercare
D. eldercare and childcare
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Flextime and Telecommuting
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
68. What is the overarching reason why an employer may offer legal services to their employees?
A. to meet federal employment regulations
B. to guard against identity theft
C. to gain insight into the employee’s financial status
D. to prevent or limit absenteeism
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Legal-Services and Identity-Theft Benefits
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
71. A company provides its employees with free dry cleaning, free lunches, and free coffee. These are part of a ______.
A. direct benefit
B. perquisites program
C. flexible benefit plan
D. profit-sharing program
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Perquisites and Other Benefits
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
72. Which is an example of a perquisites benefit?
A. giving an employee the option to sign up for health and vision benefits
B. allowing an employee to take 12 weeks unpaid time off to care for a family member
C. paying for an employee’s medical treatment after being injured on the job
D. giving an employee a designated parking spot
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Perquisites and Other Benefits
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
73. Which of these is considered a flexible benefit plan?
A. managed-care plan
B. money-purchase plan
C. cafeteria plan
D. cash balance plan
KEY: Learning Objective: 13.5: Assess the common challenges and opportunities associated with communicating benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Flexible Benefits Plans
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
True/False
1. In the civilian workforce, 70% of workers have access to two of the most common forms of voluntary benefits: medical and retirement.
KEY: Learning Objective: 13.1: Understand how benefits act as rewards and support organizational strategy.
REF: Cognitive Domain: Knowledge
Answer Location: Benefits as Rewards
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
2. The Social Security Act focuses on the economic security of one population: the elderly.
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Legally Required Benefits
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
3. An individual is eligible for Medicare at the age of 60.
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Legally Required Benefits
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
4. The employer, not the employee, is responsible for funding a company’s workers’ compensation program.
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Legally Required Benefits
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
5. Industries with higher rates of illness and injury contribute more to workers’ compensation.
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Comprehension
Answer Location: Legally Required Benefits
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
6. The Consolidated Omnibus Budget Reconciliation Act gives laid off workers opportunity to continue their existing health insurance coverage while seeking a new place to work.
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Comprehension
Answer Location: Additional Health Care Requirements
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
7. The Patient Protection and Affordable Care Act provides increased access to health-care coverage for individuals not covered by employer health-care plans.
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Knowledge
Answer Location: Additional Health Care Requirements
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
8. A managed-care plan allows individuals freedom to choose a provider of their choice with the same benefit coverage.
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Managed-Care Plans
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
9. Wendy hurt her knee playing tennis and will need 6 months to heal before returning to work. She can begin collecting payment from short-term disability immediately.
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Application
Answer Location: Disability Insurance Programs
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
10. The Employee Retirement Income Security Act does not mandate that employers provide retirement plans for their employees.
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Disability Insurance Programs
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
11. Defined-contribution plans are employee- and employer funded and are tax deferred.
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Defined-Contribution Plans
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
12. Flexible benefits plans offer employees a selection of benefit offerings.
KEY: Learning Objective: 13.5: Assess the common challenges and opportunities associated with communicating benefits programs.
REF: Cognitive Domain: Comprehension
Answer Location: Flexible Benefits Plans
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
13. Government-mandated reporting is legally required for benefits such as social insurance and workers’ compensation.
KEY: Learning Objective: 13.5: Assess the common challenges and opportunities associated with communicating benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Administering Benefits Programs | Communicating Benefits Programs
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
14. Both employees and employers typically make contributions to flexible benefits plans.
KEY: Learning Objective: 13.5: Assess the common challenges and opportunities associated with communicating benefits programs.
REF: Cognitive Domain: Knowledge
Answer Location: Communicating Benefits Programs
Difficulty Level: Easy
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
Essay
1. Imagine you are a human resource professional. Provide a cost–benefit analysis to help your employer decide which benefits to offer for maximum organizational gain.
KEY: Learning Objective: 13.1: Understand how benefits act as rewards and support organizational strategy.
REF: Cognitive Domain: Application
Answer Location: Benefits as Rewards
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
2. Why do you think employers in the United States are required to provide various social insurance programs such as worker’s compensation, unemployment insurance, and family and medical leave? Provide examples of how these programs protect people.
KEY: Learning Objective: 13.2: Identify the different types of legally required benefits.
REF: Cognitive Domain: Application
Answer Location: Legally Required Benefits
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
3. What is the function of the Employee Retirement Income Security Act (ERISA) of 1974 and its subsequent amendments? What examples can you provide of amendments to ERISA and their implications for employees?
KEY: Learning Objective: 13.3: Describe the different types of voluntary benefits.
REF: Cognitive Domain: Application
Answer Location: Additional Health Care Requirements
Difficulty Level: Medium
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
4. As a human resource professional, would you be more inclined to recommend that your employer offer a defined-benefit plan or a defined-contribution plan to employees of the company? Why?
KEY: Learning Objective: 13.4: Assess the common challenges and opportunities associated with administering benefits programs.
REF: Cognitive Domain: Analysis
Answer Location: Voluntary Benefits
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
5. What do think are possible challenges that a human resource professional may face when communicating the details and value of benefit programs offered by an employer? Identify which method of communication you think is most effective when explaining benefits programs and explain why.
KEY: Learning Objective: 13.5: Assess the common challenges and opportunities associated with communicating benefits programs.
REF: Cognitive Domain: Analysis
Answer Location: Communicating Benefits Programs
Difficulty Level: Hard
TOP: AACSB Standard: Application of knowledge
SHRM: Total Rewards
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HR Management People Data & Analytics 1e | Test Bank by Talya Bauer
By Talya Bauer