How is the Social Security program funded? A) sale of ...

[j.rubin]

How is the Social Security program funded?
 
  A) sale of government bonds
  B) tax on employee wages
  C) tax on homeowners
  D) tax on luxury goods

Question 2

Private employers forced to downsize are required to provide COBRA coverage, and some firms offer dismissed employees severance pay. How do employers benefit from providing severance pay to dismissed employees? How do employees benefit from COBRA?
 
  What will be an ideal response?

[Jordin Calloway]

Answer to Question 1

Answer: B

Answer to Question 2

Answer: Severance pay is a one-time payment offered when terminating an employee. There are several reasons for a firm to offer severance pay. It shows good will to the employee. It is good public relations. It is fair since most employees expect to receive notice in advance of an employee leaving to offer the same sort of notice to the employee. It can protect the company from litigation from disgruntled former employees. COBRA, Consolidated Omnibus Budget Reconciliation Act, requires most private employers to continue to make health benefits available to separated employees and their families for a time, generally 18 months after separation. Although the former employee must pay for the coverage, it enables coverage to continue without interruption until the individual finds a new job or purchases his or her own health insurance policy.

[j.rubin]

TYSM

[mohan]

Excellent