Part 5 1 A worker whose job is terminated can still participate in the employer’
ID: 1118113 • Letter: P
Question
Part 5
1 A worker whose job is terminated can still participate in the employer’s health plan for up to 18 months through COBRA.
True
False
2 Employees who deal with third parties are agents of their employers.
True
False
3 In order to create an agency relationship, there must be a written agreement between the principal and the agent.
True
False
4 Male as well as female employees are eligible to take unpaid leave under the Family and Medical Leave Act.
True
False
5 If you earn $10,000 from a webpage design business that you established as a sole proprietorship, the $10,000 will be taxed as personal income.
True
False
6 If you innocently buy a used textbook that was stolen, you will acquire good title to the book because you bought it in good faith.
True
False
7 If a limited liability company (LLC) chooses to be taxed as a partnership, the LLC members face the same "double taxation" as shareholders in corporations.
True
False
Explanation / Answer
1. The right answer is True.
Explanation: In simple words, COBRA or Consolidated Omnibus Budget Reconciliation Act of 1985, is a federal law which mandates all employers employing 20 or more employees and who offer health care benefits, to allow continuation of healthcare coverage to all individuals who would otherwise lose their benefits due to factors like termination, reduction in hours, etc. In the case of termination of employment or reduction in hours — the COBRA allows the terminated employee to participate in the employer’s health plan for up to 18 months.