Forming a Business: Employee Benefits and Compensation Quiz

What is the primary purpose of offering employee benefits?

• To comply with federal and state laws

• To attract and retain talented employees

• To increase the company's profit margin

• To simplify payroll management

Which of the following is a common type of employee compensation?

• Stock options

• Free meals

• Gym memberships

• All of the above

What is a 401(k) plan?

• A type of health insurance

• A performance bonus plan

• A retirement savings plan

• A stock option plan

Which of the following benefits is legally required to be provided by employers in the United States?

• Health insurance

• Paid vacation

• Social Security and Medicare contributions

• Gym memberships

What is the difference between gross pay and net pay?

• Gross pay includes taxes; net pay does not.

• Net pay includes benefits; gross pay does not.

• Gross pay is before deductions; net pay is after deductions.

• There is no difference.

What is a performance bonus?

• A fixed amount of money given to all employees at the end of the year

• An additional compensation given to employees based on their job performance

• A mandatory benefit required by law

• A type of health insurance benefit

Which of the following is NOT a typical employee benefit?

• Paid time off

• Health insurance

• Company car

• Minimum wage

How can offering a competitive employee benefits package affect a business?

• It can significantly reduce the company's profit.

• It can make it harder to attract qualified employees.

• It can improve employee satisfaction and loyalty.

• It has no effect on the business.

What is equity compensation?

• A fixed salary package

• Compensation based on the number of hours worked

• Compensation that offers employees ownership in the company, such as stock options

• A type of health benefit

Why might a company offer flexible working hours as a benefit?

• To comply with federal employment laws

• To reduce the number of employees

• To increase the company's operating hours

• To improve work-life balance and employee satisfaction