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SHRM-CP PDF DEMO:

QUESTION NO: 1
Which of the following is defined as an attempt to improve overall business operations so that customers benefit from the process?
A. Offshoring
B. Workforce expansion
C. Reengineering
D. Divestiture
Answer: C
Explanation: Reengineering is defined as an attempt to improve overall business operations so that customers benefit from the process. Workforce expansion, as the name indicates, is an increase in employees for a business to reach certain goals. Divestiture is a business decision to eliminate a department by laying off employees or moving them to another department. Offshoring, or outsourcing, refers to a business's decision to move certain activities to another location (usually international) to reduce costs.

QUESTION NO: 2
How many complaints about an employer's potential violation of FLSA rules can cause the government to step in and perform an audit of the business?
A. 2
B. 1
C. 3
D. 5
Answer: B
Explanation: It takes only one complaint about a potential FLSA violation for a government audit to occur. As a result, businesses are expected to take FLSA rules seriously, and the human resources professional must be very familiar with the rules to avoid even an unintentional violation. The other answer choices (2, 3, and 5) are all too high. By the time that many complaints arise, the audit will already be in progress or have been completed.

QUESTION NO: 3
What is the fiduciary role of the human resources professional regarding ERISA?
A. Setting up pension accounts for employees
B. Creating the rules that govern individual retirement account for employees
C. Working with organization to locate the funds for pension accounts
D. Handling and managing pension funds
E. Ensuring that the HIPAA guidelines of ERISA are observed
Answer: D
Explanation: The fiduciary role of the human resources professional regarding ERISA is primarily one of handling and managing the pension funds that the organization provides for retirement accounts.
Answer choice A is incorrect because the fiduciary role does not include setting up pension accounts for employees. (This might be another part of the human resources professional's job, but this is not the immediate fiduciary role with respect to ERISA.) Answer choice C is incorrect because the fiduciary role has nothing to do with ensuring that HIPAA guidelines are observed. Answer choice D is incorrect because human resources professional is not responsible for creating retirement account rules. And answer choice E is incorrect because the fiduciary role of the human resources professional is not necessarily one of locating the funding but rather of managing it.

QUESTION NO: 4
Which type of medical insurance plan makes contract arrangements directly with employers?
A. health maintenance organization
B. preferred provider organization
C. feeforservice plan
D. physician hospital organization
Answer: D
Explanation: A physician hospital organization makes contract arrangements directly with employers.
In this system, physicians and hospitals act as a single entity. In a health maintenance organization
(HMO), patients are managed by a gatekeeper physician, who refers them to other medical professionals when necessary. In a preferred provider organization, patients work with a designated network of medical professionals. Feeforservice plans allow the patient to shop around for medical services, the costs of which are initially covered by the patient, who is later reimbursed.

QUESTION NO: 5
Which of the following types of deferred compensation plans, also known as a discretionary contribution plan, is considered to be best in a company that has highly variable annual profits?
A. Profitsharing
B. Cash balance
C. Money purchase
D. Target benefit
Answer: A
Explanation: A profitsharing plan, also known as a discretionary contribution plan, is considered to be best in a company that has highly variable annual profits. A money purchase plan offers employees a fixed annual percentage and thus is best in a company that has fairly consistent annual earnings. A cash balance plan is considered "portable" because employees can remove the money from the plan and convert the payment into other forms. A target benefit plan uses actuarial formulas to determine how much an employee will receive toward retirement.

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Updated: May 28, 2022