Finance 4354
Questions for Final
Chapters 12, 16, 18, 20, 21, 22, 17, Loco Case Study, 15
Chapter 12
1. Damages, when in form of monetary compensation can be 3 forms. Name and describe
these. Gives examples of each.
2. Our laws in the United States are based on custom and court decisions as common law.
These counts are guided by the doctrine of stare decisis. What does that mean?
3. Negligence can be determined by the existence of 4 elements. What are they?
4. Negligence has defenses with varying degrees of acceptance. Name and describe 4.
5. Several suggestions have been made to alleviate the problems of product liability. Name
4 of them.
Chapter 16
6. There are three common law defenses that were available to employers before workers
compensation was established. Describe them.
7. Name and describe the 4 types of benefits available to employees and provided by
workers compensation.
8. A workers compensation policy, the simplest of all the policies used, has three parts.
What are they?
9. Calculate the workers compensation premium using retrospective information at 3 loss
amounts.
Standard Premium
Basic
Loss Conversion Factor
Tax Multiplier
Minimum Premium
Maximum Premium
$2,200,000
15%
1.15
1.04
60%
145%
Losses $700,000
Losses $1,500,000
Losses $2,500,000
Retro Premium __________
Retro Premium __________
Retro Premium __________
10. What are the 4 social benefits as described and discussed in Chapters 16 and 18?
Chapter 18
11. Social Security pays for four types of benefits. What are they?
12. What’s COLA and how does it apply to Social Security?
13. How is social security financed and what are the (any) limitations on salary exposures?
14. Describe the so called pay-as-you-go system for Social Security.
15. Name and describe the four parts of Medicare.
16. Describe privatization as may be proposed and describe if you would be in favor of these
changes of any other changes.
Chapter 20
17. Name 10 employee benefits that you wish to receive from your employer.
18. Describe benefits, continuity and portability of a benefit plan.
19. Describe a cafeteria plan and express your opinion as to its desirability.
20. How does a Flexible Spending Account work? Would you subscribe to one? Why?
21. There are at least 5 federal regulations that apply to employee benefits. What are they?
Chapter 21
22. ERISA sets out requirements for a qualified pension plan. What are they?
23. What is vesting? How could it benefit you?
24. What is a traditional Defined Benefit Plan?
25. What is a Defined Contribution Plan and would you prefer a DC or DB plan and why?
26. What is a 401(k) plan and how does it work? What is a 403(b) plan and Keogh Plan?
Chapter 22
27. What is managed care? Describe the several types.
28. Describe a Health Savings Account and if you would participate in one and why.
Chapter 17
29. Name at least 3 factors that life expectancy depends on. (Section 3.2)
30. What are the 3 kinds of disabilities? (Section 4.3)
31. Why does retirement seem the most pressing of issues in developing economies? (Section
5.1)
32. What characterizes the current United States system of retirement? (Section 5.1)
Loco Case Study
33. What is alternate risk financing and how is it used with firms?
34. Why should risk managers select some form of ARM and what might be the reasons to
do so?
Chapter 15
35. What coverages may be included in a commercial package policy (CPP)? Be specific.
36. What is an umbrella policy? What are the determinants of securing one and how does
this function?