Which of the Following Is a Disadvantage of Providing Flexible

question 91

Multiple Choice

Which of the following is a disadvantage of providing flexible benefits plans?

• A) These plans do not cover higher-risk employees.
• B) There is a risk that employees will choose an inappropriate benefits package.
• C) These plans are typically discriminatory in nature.
• D) There is a risk that these plans will increase the attrition rate.

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Definitions:

Net Operating Income

The income generated from normal business operations, calculated as revenues minus operating expenses and excluding income from investments and taxes.

Average Operating Assets

The average value of assets used by a company in its operational activities, calculated over a certain period of time for analysis of performance efficiency.

Residual Income

The income that remains after subtracting all required costs of capital from the operating income; a measure of net profitability.

Minimum Required Rate of Return

The least return expected by investors for assuming the risk of investing in a project or security.