COMP ch 7

Which of the following is an example of a quoted-price? A. A product on e-Bay B. A product on Priceline C. A used car D. A product on Amazon

A product on Amazon

Which theory supports the idea that coal mining should be paid more than office clerical work? A. Signaling B. Marginal productivity C. Efficiency wage D. Compensating differentials

Compensating differentials

Which of the following is not a reason a company might pay base wages above market competitors? A. Employees are more productive B. Turnover will be lower C. Competitor production costs are lower D. To attract more job applicants

Competitor production costs are lower

Wages tend to be low in which of the following industries? A. Education and health care B. Technology intensive industries C. Professional services D. Pharmaceuticals

Education and health care

_____ theory is typically associated with greater profits. A. Signaling B. Compensating wage differentials C. Efficiency wage D. Human capital

Efficiency wage

___________ theory is most useful for explaining variations in pay mix. A. Signaling B. Compensating wage differentials C. Efficiency wage D. Human capital

Efficiency wage

If Company A raises its pay rate one dollar per hour to hire additional workers and competitors immediately match the increase, what is the most likely result? A. Higher labor costs for Company A, but not more workers B. Company A will hire the needed workers at the higher wage rate C. Competitors will lose employees to Company A D. Company A will hire higher quality workers

Higher labor costs for Company A, but not more workers

Which of the following is not a consequence of level of competitiveness of total compensation? A. Increase probability of union-free status B. Increase organization profitability C. Reduce voluntary turnover D. Reduce pay-related work stoppages

Increase organization profitability

A small lawn care company has two mowers and four employees. If it hires another employee, how productive will productivity of the fifth employee compare to the current two employees? A. Less productive B. More productive C. The same D. There is not enough information to determine productivity

Less productive

_____ refers to the average of the array of rates paid by an employer. A. Cost to the company B. Remuneration C. Compensation D. Pay level

Pay level

Which of the following is an example of the demand side of labor? A. Level of pay applicants will accept B. Qualifications of applicants C. Pay level offered by an employer D. Locations of potential employees

Pay level offered by an employer

Which of the following factors do not affect an employer's ability to pay high wages? A. Product demand B. Degree of competition C. Productivity of labor D. Supply of skilled employees

Supply of skilled employees

Which of the following is not true of the relationship between employer size and its ability to pay? A. Talented individuals have a higher marginal value in a larger organization. B. Talented people can influence more people and decisions. C. Influence of talented people leads to more profits. D. Talented people prefer to work in larger organizations.

Talented people prefer to work in larger organizations.

If Company A and Company B pay the same total compensation for a job, which of the following is most likely true? A. Base pay is same B. Benefits costs are the same C. The pay mix differs D. The pay mix is the same

The pay mix differs

_____ sets a maximum pay level an employer can pay. A. Government legislation B. The product market C. The labor market D. Labor market competitors

The product market

In which of the following would data from labor market competitors be given more weight than product market competitors data? A. Labor costs area a large share of total costs B. Employee skills are specific to the product market C. Product demand is responsive to price changes D. The supply of labor is responsive to changes in pay

The supply of labor is responsive to changes in pay

_____ is an example of a bourse. A. The stated starting wage of a job in an ad B. The total compensation for a top athlete C. The price of a product on Amazon D. The price of a box of cereal at a grocery store

The total compensation for a top athlete

All of the following are important factors in defining a market for compensation purposes except: A. skill/knowledge required. B. geography. C. ability to pay. D. product and/or labor market competitors.

ability to pay.

The mix or forms of pay compared to competitors is a part of _____________ A. internal alignment B. contributions C. competitiveness D. management

competitiveness

Rent sharing is most commonly associated with the _____ theory. A. human capital B. signaling C. marginal productivity D. efficiency wage

efficiency wage

The theory that has the most implications for staffing is _____ theory. A. compensating differentials B. efficiency wage C. signaling D. marginal productivity

efficiency wage

__________ theory is the basis for the sorting effect pay strategy has on the composition of a workforce/ A. human capital B. signaling C. marginal productivity D. efficiency wage

efficiency wage

Employers continue to hire until marginal revenue of the last hire equals their wage rate because as per the first labor market theory assumption: A. markets are competitive. B. pay rates reflect all costs of employment. C. employers seek to maximize profits. D. workers are homogeneous and interchangeable.

employers seek to maximize profits.

Which of the following is not a factor explaining differences in pay offered to graduating college students? A. grades and interview skills B. location of company C. type of work D. industry

grades and interview skills

All of the following are true regarding efficiency wage theory research except __________ A. higher wages is associated with fewer disciplinary layoffs. B. fewer supervisors are required. C. higher wages reduces profits. D. more applicants apply for jobs.

higher wages reduces profits.

Segmented labor supply involves all of the following except: A. hiring from different sources B. paying workers differently who are performing the same work C. hiring from different sources and differential pay and benefits for the same work D. employing regulars, part-timers, and temps

hiring from different sources and differential pay and benefits for the same work

The _____ theory is the most influential in explaining pay-level differences. A. human capital B. marginal productivity C. efficiency wage D. signaling

human capital

The pay policy associated with increased productivity is the _____ policy. A. lead B. match C. hybrid D. employer of choice

hybrid

Pay level decisions have a significant impact on expenses. Other things being equal, the higher the pay level, the higher the: A. margins. B. labor costs. C. return on investments. D. fixed costs.

labor costs.

A pay policy most likely to reduce pay dissatisfaction is _____. A. lead B. employer of choice C. hybrid D. match

lead

In a hiring situation, considering that other potential costs will not change in the short run, the level of demand that maximizes profits is that level at which the _____ of the last hire is equal to the _____ for that hire. A. demand factor; supply factor B. marginal output; market price C. incremental output; marginal output D. marginal revenue; wage rate

marginal revenue; wage rate

The most common pay policy is _____. A. lead B. lag C. hybrid D. match

match

Research on efficiency wage theory shows that: A. more unqualified workers apply B. disciplinary layoffs are higher C. more supervision is required D. profits are not related

more unqualified workers apply

The market pay rate is the: A. minimum wage rate set by the Department of Labor. B. pay rate at which applicants will accept a job. C. going rate. D. point at which supply and demand lines cross.

point at which supply and demand lines cross

Evidence shows that in manufacturing, _____ is positively correlated with hourly wage level. A. retention B. productivity C. job satisfaction D. total profit

productivity

The study referred to in the text on how managers make wage adjustment decisions found: A. level of unemployment had a major effect B. profitability affected the overall pay budget C. managers believed efficiency wage theory D. managers believed higher pay makes supervision easier

profitability affected the overall pay budget

All of the following are advantages of a lead pay policy except _____. A. reduced vacancy rates B. reduced turnover C. reduced absenteeism D. higher financial performance

reduced vacancy rates

If a friend told you they would not accept a job after graduating for less than $50,000 per year, they would be demonstrating the _________ theory. A. human capital B. reservation wage C. signaling D. efficiency

reservation wage

Implication of the _____ theory is that pay level affects an employer's ability to recruit. A. human capital B. reservation wage C. signaling D. efficiency

reservation wage

In _____ theory, pay is described as noncompensatory. A. efficiency wage B. signaling C. reservation wage D. marginal productivity

reservation wage

Among pay-mix alternatives, base pay is largest in _____. A. work-life balance B. security or commitment C. performance driven D. market match

security or commitment

All of the following except the _____ shape external competitiveness. A. skill level of employees B. nature of demand C. industry strategy D. level of product demand

skill level of employees

Output associated with hiring an additional person, holding constant other production factors, is referred to as: A. productivity. B. the marginal product of labor. C. incremental productivity. D. the marginal revenue product of labor.

the marginal product of labor.

The assumption of the upward sloping supply curve may not hold when _____. A. wages are low B. wages are high C. unemployment is low D. unemployment is high

unemployment is low

A study of graduating college students found they sought jobs with all of the following pay characteristics except ___________ A. individual-based pay. B. variable pay. C. flexible benefits. D. job-based pay.

variable pay.

The pay-mix component in which benefits is likely to be largest is _____. A. work-life balance B. security or commitment C. performance driven D. market watch

work-life balance