Question 1

As in the case of merit pay,performance bonuses for rewarding individual performance are rolled into an employee's base pay.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following types of incentive plans are used to reward individual performance?

Accepted Answer

A)   Gainsharing
B)   Merit pay
C)   Scanlon plan
D)   Profit sharing
E)   Stock ownershipF) None of the above
G) A) and E)

Question 3

Which of the following is a disadvantage of using group bonuses?

Accepted Answer

A)   Physical outputs are not rewarded.
B)   It reduces the level of cooperation between the members of the group.
C)   The performance measures used are narrow.
D)   It could result in competition among groups.
E)   It cannot be used to promote specific goals.F) A) and B)
G) C) and D)

Question 4

Which of the following statements is true of using stock options as incentive pay?

Accepted Answer

A)   The use of stock options ensures that managers add value in terms of efficiency and customer satisfaction.
B)   Stock options require an option holder to purchase the organization's stocks at its present market rate.
C)   Stock options are rewarding for employees who exercise their option when the company's stock value has risen.
D)   Low-level employees with stock options are more likely to think like owners than executives who have stock options.
E)   A company's performance in the stock market tends to be significantly better if its low-level employees are provided stock options.F) A) and B)
G) B) and C)

Question 5

Jeff owns and manages a small electronics repair store.He determines the time required by his employees to complete each task assigned by him.When employees complete the repairs in less time,they receive an amount of pay equal to that time determined by him.In this scenario,Jeff is using the:

Accepted Answer

A)   standard hour plan.
B)   differential piecework plan.
C)   merit pay plan.
D)   straight piecework plan.
E)   Scanlon plan.F) None of the above
G) C) and D)

Question 6

_____ refers to an incentive pay in which the wage paid is higher when a greater amount is produced.

Accepted Answer

A)   Profit sharing
B)   Differential piece rate
C)   Gain sharing
D)   Scanlon pay
E)   Merit payF) A) and D)
G) A) and C)

Question 7

The balanced-scorecard approach should be avoided while designing executive pay.

Accepted Answer

A) True 
 B)False

Question 8

The many kinds of incentive pay fall into three broad categories: _____

Accepted Answer

A)   incentives linked to individual, group, or organizational performance.
B)   incentives linked to output, productivity, or quality of a product.
C)   pay linked to goals, focus, or achievements of an organization.
D)   pay related to base salary, bonus, and travel allowance.
E)   incentives obtained in the form of company shares, gift coupons, and trial products.F) B) and E)
G) C) and E)

Question 9

When an employee's pay is calculated as a percentage of sales,it is referred to as:

Accepted Answer

A)   commission.
B)   gain sharing.
C)   merit plan.
D)   variable wage plan.
E)   profit sharing.F) D) and E)
G) A) and C)

Question 10

In the context of stock ownership,what is meant by backdating a stock option?

Accepted Answer

A)   Reaping windfall in the stock market by selling stock based on company's nonpublic information
B)   Falsifying numbers in the company's annual report to hide losses and inflate the stock prices
C)   Buying company's stock just before the date of key product launch
D)   Changing the price in the original option agreement so that the option holder can buy stock at a bargain price
E)   Re-evaluating a company's stocks to adjust it to a previous date so that the shareholders and employees minimize the lossesF) B) and E)
G) D) and E)

Question 11

Piecework rate plans are most suited for _____.

Accepted Answer

A)   innovative tasks
B)   non-standard jobs
C)   managerial jobs
D)   jobs with difficult-to-measure output
E)   routine jobsF) A) and E)
G) A) and C)

Question 12

Straight commission plans are plans which:

Accepted Answer

A)   provide a straight salary to employees.
B)   are useful when the organization wants salespeople to concentrate on listening to customers.
C)   help to attract risk-averse employees.
D)   are common among insurance and real estate agents.
E)   are uncommon among car salespeople.F) A) and B)
G) C) and E)

Question 13

In the process of designing incentives,managers should make sure that:

Accepted Answer

A)   all the employees are paid the same amount.
B)   even the lowest performing employees are rewarded.
C)   employees focus only on completing the task quickly.
D)   employees believe that the pay plan is fair.
E)   they hire employees who consider earning money as the sole reason to perform well.F) A) and B)
G) B) and E)

Question 14

A standard hour incentive plan is likely to be successful if:

Accepted Answer

A)   most or all of a salesperson's compensation is in the form of commissions.
B)   employers keep labor costs to a minimum.
C)   the pay increase is linked to ratings on performance appraisals.
D)   employees want the extra money more than they want to work at a pace that feels comfortable.
E)   the organization values employee satisfaction, product quality, and customer service more than profits.F) A) and D)
G) A) and E)

Question 15

Stock options are best suited to motivate day-to-day effort or to attract and retain top individual performers.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is a method where a combination of performance measures directed toward the company's long- and short-term goals are used as the basis for awarding incentive pay?

Accepted Answer

A)   Merit pay
B)   Profit sharing
C)   Gainsharing
D)   Balanced scorecard
E)   Scanlon planF) B) and E)
G) A) and B)

Exam 13: Recognizing Employee Contributions With Pay

When an employee's pay is calculated as a percentage of sales,it is referred to as:

Correct Answer
verified

_____ refers to an incentive pay in which the wage paid is higher when a greater amount is produced.

Correct Answer
verified

A standard hour incentive plan is likely to be successful if:

Correct Answer
verified

Which of the following is a disadvantage of using group bonuses?

Correct Answer
verified

The balanced-scorecard approach should be avoided while designing executive pay.

Correct Answer
verified

In the context of stock ownership,what is meant by backdating a stock option?

Correct Answer
verified

Jeff owns and manages a small electronics repair store.He determines the time required by his employees to complete each task assigned by him.When employees complete the repairs in less time,they receive an amount of pay equal to that time determined by him.In this scenario,Jeff is using the:

Correct Answer
verified

Which of the following is a method where a combination of performance measures directed toward the company's long- and short-term goals are used as the basis for awarding incentive pay?

Correct Answer
verified

The many kinds of incentive pay fall into three broad categories: _____

Correct Answer
verified

Piecework rate plans are most suited for _____.

Correct Answer
verified

As in the case of merit pay,performance bonuses for rewarding individual performance are rolled into an employee's base pay.

Correct Answer
verified

Which of the following statements is true of using stock options as incentive pay?

Correct Answer
verified

Straight commission plans are plans which:

Correct Answer
verified

In the process of designing incentives,managers should make sure that:

Correct Answer
verified

Stock options are best suited to motivate day-to-day effort or to attract and retain top individual performers.

Correct Answer
verified

Which of the following types of incentive plans are used to reward individual performance?

Correct Answer
verified

Exam 13: Recognizing Employee Contributions With Pay

When an employee's pay is calculated as a percentage of sales,it is referred to as:

Correct AnswerverifiedShow Answer

_____ refers to an incentive pay in which the wage paid is higher when a greater amount is produced.

Correct AnswerverifiedShow Answer

A standard hour incentive plan is likely to be successful if:

Correct AnswerverifiedShow Answer

Which of the following is a disadvantage of using group bonuses?

Correct AnswerverifiedShow Answer

The balanced-scorecard approach should be avoided while designing executive pay.

Correct AnswerverifiedShow Answer

In the context of stock ownership,what is meant by backdating a stock option?

Correct AnswerverifiedShow Answer

Jeff owns and manages a small electronics repair store.He determines the time required by his employees to complete each task assigned by him.When employees complete the repairs in less time,they receive an amount of pay equal to that time determined by him.In this scenario,Jeff is using the:

Correct AnswerverifiedShow Answer

Which of the following is a method where a combination of performance measures directed toward the company's long- and short-term goals are used as the basis for awarding incentive pay?

Correct AnswerverifiedShow Answer

The many kinds of incentive pay fall into three broad categories: _____

Correct AnswerverifiedShow Answer

Piecework rate plans are most suited for _____.

Correct AnswerverifiedShow Answer

As in the case of merit pay,performance bonuses for rewarding individual performance are rolled into an employee's base pay.

Correct AnswerverifiedShow Answer

Which of the following statements is true of using stock options as incentive pay?

Correct AnswerverifiedShow Answer

Straight commission plans are plans which:

Correct AnswerverifiedShow Answer

In the process of designing incentives,managers should make sure that:

Correct AnswerverifiedShow Answer

Stock options are best suited to motivate day-to-day effort or to attract and retain top individual performers.

Correct AnswerverifiedShow Answer

Which of the following types of incentive plans are used to reward individual performance?

Correct AnswerverifiedShow Answer

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verified

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