Chapter 01
The Pay Model
Multiple Choice Questions
1.
Which of the following programs introduced by Congress includes restrictions on executive pay that are designed to discourage executives from taking "unnecessary and excessive risks"?
A.
Corporate Welfare Program
B.
Employee Welfare Program
C.
Troubled Asset Relief Program
D.
Corporate Liability Relief Program
2.
Hourly compensation costs for production workers in manufacturing are higher in _____ than in the United States.
A.
Germany
B.
Czech Republic
C.
Mexico
D.
China
3.
One of the reasons why 8 in 10 of the uninsured in the United States are from working families is that _____.
A.
many larger employers do not offer health insurance as it does not guarantee an increase in productivity levels
B.
health insurance is more costly for larger employers
C.
many small employers are much less likely than larger employers to offer health insurance to their employees
D.
most workers decline health insurance when offered by their employers
4.
The degree to which pay influences individual and aggregate motivation among employees at any point in time is referred to as a(n):
A.
sorting effect.
B.
incentive effect.
C.
turnover effect.
D.
directional effect.
5.
Which of the following is an example of a relational return?
A.
Short-term incentives
B.
Employment security
C.
Long-term incentives
D.
Income protection
6.
Which of the following is given as an increment to the base pay in recognition of past work behavior?
A.
Base pay
B.
Long-term incentive
C.
Merit pay
D.
Short-term incentive
7.
GreenRain Corp. faces an increase in employee turnover rate. The CEO calls for a board meeting with the senior executives to discuss the issue. Who among the following suggests increasing the relational returns that employees receive to reduce the turnover rate at GreenRain?
A.
Tom suggests increasing the decision-making authorities given to the employees to make work more challenging.
B.
Deena suggests providing more work/life balance for the employees by increasing the number of paid leaves.
C.
Syed suggests increasing the medical insurance coverage offered to the employees.
D.
Liam suggests increasing merit bonuses.
8.
Which form of pay does not permanently increase labor costs?
A.
Incentive
B.
Merit pay
C.
Cost-of-living adjustments
D.
Base pay
9.
Recent surveys show that, on average, an outstanding performer receives a _____ merit increase, an average performer a _____ merit increase, and a poor performer a 0.4% merit increase.
A.
10.5%; 7%
B.
8.4%; 5.2%
C.
6.7%; 4.2%
D.
4.4%; 2.8%
10.
Which of the following companies is taking efforts to improve the work/life balance of its employees?
A.
MH Corp. increases the number of paid holidays given to its senior employees.
B.
Kay Corp. increases the transport allowance for its employees by 10 percent.
C.
Haywire Corp. allows its employees to buy company stocks at a reduced price of $30 per share.
D.
Halo Corp. increases the variable pay for its employees.
11.
Variable pay may also be called _____.
A.
relational returns
B.
The Pay Model
Multiple Choice Questions
1.
Which of the following programs introduced by Congress includes restrictions on executive pay that are designed to discourage executives from taking "unnecessary and excessive risks"?
A.
Corporate Welfare Program
B.
Employee Welfare Program
C.
Troubled Asset Relief Program
D.
Corporate Liability Relief Program
2.
Hourly compensation costs for production workers in manufacturing are higher in _____ than in the United States.
A.
Germany
B.
Czech Republic
C.
Mexico
D.
China
3.
One of the reasons why 8 in 10 of the uninsured in the United States are from working families is that _____.
A.
many larger employers do not offer health insurance as it does not guarantee an increase in productivity levels
B.
health insurance is more costly for larger employers
C.
many small employers are much less likely than larger employers to offer health insurance to their employees
D.
most workers decline health insurance when offered by their employers
4.
The degree to which pay influences individual and aggregate motivation among employees at any point in time is referred to as a(n):
A.
sorting effect.
B.
incentive effect.
C.
turnover effect.
D.
directional effect.
5.
Which of the following is an example of a relational return?
A.
Short-term incentives
B.
Employment security
C.
Long-term incentives
D.
Income protection
6.
Which of the following is given as an increment to the base pay in recognition of past work behavior?
A.
Base pay
B.
Long-term incentive
C.
Merit pay
D.
Short-term incentive
7.
GreenRain Corp. faces an increase in employee turnover rate. The CEO calls for a board meeting with the senior executives to discuss the issue. Who among the following suggests increasing the relational returns that employees receive to reduce the turnover rate at GreenRain?
A.
Tom suggests increasing the decision-making authorities given to the employees to make work more challenging.
B.
Deena suggests providing more work/life balance for the employees by increasing the number of paid leaves.
C.
Syed suggests increasing the medical insurance coverage offered to the employees.
D.
Liam suggests increasing merit bonuses.
8.
Which form of pay does not permanently increase labor costs?
A.
Incentive
B.
Merit pay
C.
Cost-of-living adjustments
D.
Base pay
9.
Recent surveys show that, on average, an outstanding performer receives a _____ merit increase, an average performer a _____ merit increase, and a poor performer a 0.4% merit increase.
A.
10.5%; 7%
B.
8.4%; 5.2%
C.
6.7%; 4.2%
D.
4.4%; 2.8%
10.
Which of the following companies is taking efforts to improve the work/life balance of its employees?
A.
MH Corp. increases the number of paid holidays given to its senior employees.
B.
Kay Corp. increases the transport allowance for its employees by 10 percent.
C.
Haywire Corp. allows its employees to buy company stocks at a reduced price of $30 per share.
D.
Halo Corp. increases the variable pay for its employees.
11.
Variable pay may also be called _____.
A.
relational returns
B.