1.Distinguishing between employees and independent contractors is important because:

A.Income tax must be withheld for employees, but not independent contractors.

B.Employers have fewer legal obligations to independent contractors.

C.Employers can defend their actions under employment laws by proving that persons performing work are independent contractors.

D.All of the above.

E.None of the above.

2.Kay is Mildred's employee. Pete also works for Mildred. Kay and Pete are in a personal relationship. Kay's job is to visit Mildred's shops and check inventory. Pete has the same job, but for different shops. One day, Kay is on her way to a shop when Pete calls and says he made a big mistake, and wants Kay to come help him fix it so Mildred won't find out. Kay drives to the other side of town to help Pete. On the way back from seeing Pete, Kay causes a minor car accident. Who is the other driver likely to sue?

A.Pete and Kay.

B.Kay.

C.Mildred.

D.Kay and Mildred.

E.Kay and Mildred and Pete.