MGT 559 Exam 3

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The duration of​ short-term international assignments is usually​ ________ or less.

1 year

Employees in China who have worked for more than 20 years are entitled to paid leave of​ ________.

15 days

Involuntary​ part-time employees work fewer than​ ________ hours per week.

35

Executives must have​ ________ percent of ownership in a firm before they are classified as a highly compensated employee by the Internal Revenue Code​ (IRC).

5

An​ employer-sponsored retirement plan is considered​ top-heavy when the accrued benefits of key employees exceed​ ________ percent of the accrued benefits of all employees.

60

What is the length of compassionate care leave provided by the Canadian government to take care of a seriously ill family​ member?

8 weeks

Based on the criteria for key​ employees, which of the following positions would be considered a key​ employee?

CEO

What is one reason that labor is less costly in​ Mexico?

Mexican labor unions lack strength and bargaining power

Which is true when comparing​ non-U.S. CEOs with U.S.​ CEOs?

U.S. CEOs make 300 percent more than non-U.S. CEOs

Which of the following is true about U.S. citizens paying taxes while working overseas for a U.S.​ corporation?

U.S. citizens are subject to the Federal Unemployment Tax Act (FUTA)

Which country in South America has large oil​ reserves?

Venezuela

Which of the following would be entitled to receive an international compensation​ package?

a U.S. citizen who is working at the Italian office of a U.S. company

The total bonus pool is considered when using the predetermined allocation bonus for an executive. What is the key factor that determines the size of the total bonus​ pool?

a company's profits

​Miranda, the CEO of TVX​ Enterprises, has a compensation arrangement in which the TVX board of directors promises to pay her a bonus in the form of the equivalent of either the value of TVX shares or the increase in that value over a period of time. Which term refers to​ Miranda's compensation​ arrangement?

a phantom stock plan

For employees who participate in job​ sharing, which of the following is a likely​ benefit?

ability to participate in an employee retirement program

Which statement regarding executive compensation is​ true?

academic research is not decisive regarding a connection between executive compensation and company performance

The idea behind deferred compensation for an executive is to​ ________.

align the executive's and shareholders' interests in the long term

The current executive core compensation consists of​ ________.

annual base pay and bonuses

​Part-time employees are eligible for retirement benefits if they​ ________ and​ have________.

are 21 years or age or older; 1,000 hours logged in a 12-month period

Unions in the public sector feel that flex schedules​ ________.

are acceptable, because they raise the productivity of employees, which makes the unions stronger

Minimum wage rates in India​ ________.

are set by the government and a collective agreement

minimum wage in Germany is established

by the collective bargaining system

Sonia works 40 hours each week at a publishing company. She works Monday through Thursday from​ 8:00 a.m. until​ 6:00 p.m. Which term best describes​ Sonia's work​ arrangement?

compressed workweek schedule

Why are contingent workers perceived as a threat by most labor​ unions?

contingent workers tend to threaten members' job security

U.S. companies designing international compensation packages divide the total package into three broad​ categories, which are​ ________.

core compensation, employee benefits, and enhanced benefits

Some globally focused​ companies, such as GE and​ McDonald's, maintain a strong international presence. Such firms support expatriates by offering​ ________.

corporate universities that prepare soon-to-be expatriates to work abroad

Which of the following would contain detailed information on the compensation of a​ firm's CEO and Named Executive​ Officers?

definitive proxy statement

Companies​ ________ allowances for discretionary income expenditures for which expats remain responsible in the United States.

do not pay

Many companies use​ ________ as the pay referent​ group, where others use​ ________ as the pay referent group when determining international compensation packages.

domestic employees; local employees

Which is true of Canadian wage rates and​ benefits?

employees are entitled to have 8 or 9 holidays, 2 weeks of vacation, and a sum of money as vacation pay

Which of the following is a paid​ time-off benefit in​ Germany?

employees receive regular pay during illness for up to 6 weeks

Which of the following is an employment stipulation according to the laws of EU member​ states?

employers must give employees a written document specifying the terms of the employment contract

All of the following are components of the standard benefits package for an expatriate EXCEPT​ ________.

entertainment allowances

How do executives receive an income tax benefit by participating in incentive stock option​ plans?

executives do not pay any taxes until they sell their stock, and when they do sell, the tax rates are lower than their income tax

Which of the following describes the agency​ problem?

executives make decisions in their own self-interests

When referring to executive​ compensation, what is mean by the term ​pay-for-failure​?

executives receive pay for nonperformance and are given generous amounts to leave the company

Which of the following is a U.S. citizen employed by a U.S. company with a work assignment outside the United​ States?

expatriate

The balance sheet approach is most appropriate for setting a U.S.​ expatriate's compensation package when the​ ________.

expatriate's next assignment will be in the U.S.

What criteria are used by the U.S. Department of State for identifying hardship​ locations?

extraordinarily difficult living conditions, excessive physical hardships, and notably unhealthy conditions

Labor and employment laws in Canada​ ________.

fall within provincial jurisdiction

Temporary workers are primarily hired by companies to​ ________.

fill a need during peak times

Compensation consultants determine executive pay based on a strategic analysis of internal and external factors of an organization. The most important internal factor in determining executive compensation is the​ ________.

financial condition of the company

Which of the following statements is FALSE regarding flexible work​ schedules?

flexible work schedules can reduce productivity

Leasing employees to a client company is common in which type of​ industry?

food

Which statement about the annual base pay for an executive is​ true?

for most executives, annual base pay represents a small part of their total compensation

​________ are monetary payments above and beyond regular base pay that are given for international assignments that last longer than one year.

foreign service premiums

How do employers benefit from compressed​ workweeks?

greater workplace productivity

What is the term that describes the market value of all goods and services produced in a country in a given​ year?

gross domestic product

An officer in an organization is someone who​ _________.

has the title and authority of an officer

Flex work schedules are best for companies that want to promote differentiation strategies. This is because flex schedules​ ________.

help employees work without being distracted by personal matters

Which method compensates expatriates the same as if they were doing similar work in the United​ States?

home country-based method

The North American Agreement on Labor Cooperation​ (NAALC) was created to​ ________.

improve labor conditions in the United States, Canada, and Mexico

Which statement is true about the Brazilian​ economy?

in Brazil, all benefits granted by employers are legally part of employee salaries and cannot be abolished

What has been the subject of current debates in​ Canada?

increasing health care costs

Which authority provides the criteria for defining an​ executive?

internal revenue code

Which of the following is the most accurate description of why labor union opposition to contingent employees is unlikely to change in the near​ future?

labor unions see the practice of contingent employees as undermining their efforts to secure high wages and job security for their members

​Technically, when contingent workers are placed in an​ organization, they are​ ________.

legally accountable to the temporary employment agency that hired them

When an expatriate in China gets fewer yuan in exchange for​ dollars, the expat is facing​ ________.

loss in purchasing power

Successful international compensation programs should​ _________.

minimize an employee's financial risk while overseas

Flextime schedules allow workers to​ ________.

modify their work schedules within the limits set by the employer

All of the following are true of the ethical considerations regarding executive pay​ EXCEPT:

most CEOs who are hired form within make more money than those who are recruited from outside the company

It makes sense to use the​ headquarters-based method in designing an international compensation package when an employee is​ ________.

moving from one country to another and rarely works in the home country

Many U.S. manufacturing companies have established facilities in Asian countries and in Mexico because these two locations offer​ ________.

much less expensive labor

Basic medical and hospital care in Canada is​ ________.

paid from general federal taxation and from provincial taxes

Flex workweek schedules have the greatest impact on​ ________.

paid time-off benefits

Expatriates who earn higher incomes in the United States generally receive higher incomes and allowances to maintain their lifestyle overseas.​ However, this also means​ ________.

paying higher taxes on the income and allowances

What is the key difference between target plan bonus and predetermined allocation​ bonus?

predetermined allocation bonuses are fixed; target plan bonuses are not

Most economists prefer using​ ________ when evaluating per capita welfare and when comparing living conditions across countries.

purchasing power parity exchange rates

What has been the effect on wages in the United​ States, Canada, and Mexico since the passing of​ NAFTA?

real wages have increased in the three countries since the passage of NAFTA

From an​ employer's perspective, job sharing is likely to result in​ ________.

reducing employee training costs

International and domestic benefits differ in terms of allowances and reimbursements. The difference for expatriates is primarily due to higher costs of living and​ housing, ________, and​ ________.

relocation expenses; educational allowances for expatriates' children

Which of the following best describes​ repatriation?

repatriation is the process of making the transition form an international assignment to a domestic assignment

Which statement about returning expatriates is​ FALSE?

returning expatriates find it easy to participate with collaborative teams

One of the outcomes of globalization is that companies now have to send employees overseas to establish​ ________.

satellite plants and offices for U.S. companies

Which statement about Asian economies is​ true?

services are a significant source of growth in the Indian economy

When considering executive​ compensation, boards of directors are theoretically representing the interests of​ ________.

shareholders

The Chinese economy in the last couple of decades has​ ________.

shifted from a centrally planned system to a market-based system

Which is true of pension and health benefits in​ India?

state governments in India arrange for health care

What are the three main sections of the quarters allowance that the U.S. Department of State uses for determining housing and utilities​ allowance?

survey date, exchange rate, and annual allowance by family status and salary range

Zachary has a​ full-time position with an accounting firm. Zachary works in the​ firm's office when he needs to attend​ meetings, but the majority of his work is accomplished in his home office. Which term best describes​ Zachary's work​ arrangement?

telecommuting

Which statement about temporary employment agencies is​ true?

temporary agency fees are based on a percentage of a placement's pay rate

Which is true of seasonal​ workers?

the FLSA's minimum wage and overtime provisions do not apply to some seasonal workers

Which statement about Mexico is​ FALSE?

the Mexican economy is mainly agricultural

Which of the following is true about expatriates receiving a goods and services​ allowance?

the allowance uses the Washington, DC, area for cost comparisons

Stock compensation plans generally increase the ownership interest of an executive. What increases the value of a​ stock?

the gain in company performance

Due to a potential conflict of​ interest, what is the primary consideration for executive consulting firms when suggesting executive​ pay?

the public image of the consulting firm

Which statement is FALSE regarding the minimum wage in​ China?

there is a national minimum wage rate that is set by the central government

How do companies create an ownership interest for an​ executive?

through granting stock and stock options

Executives are awarded​ short-term incentive compensation. What is the reason for giving​ short-term incentive compensation to​ executives?

to recognize their pursuit of competitive strategy goals

What has been one of the key challenges for the central government in​ China?

to sustain adequate job growth for the massive population

Job sharing at work is an arrangement where​ ________

two or more part-time employees perform a single full-time job

What is the overall view of labor unions regarding​ companies' use of contingent workers and flex​ schedules?

unions generally do not support contingent work and flex work schedules

Which group of contingent workers chooses to work fewer than 35 hours per regularly scheduled​ workweek?

voluntary part-time employees

Under the old welfare system in​ China, workers​ ________.

were treated as the property of the state

How do companies know when compensation expenditures become​ excessive?

when compensation expenditure is greater than quantity and quality of labor output

One of the advantages of hiring contingent workers is that it prevents groupthink from occurring in the workplace. Which of the following best describes​ groupthink?

when groups think alike and have mistaken solutions for existing problems

What is the focus of the economic realities test for independent​ contractors?

whether the worker is financially dependent on an employer

Canadian pension plans are funded​ ________.

with matching contributions by employers and employees

The dual employer doctrine law states that temporary workers have a right to​ _________

workers' compensation

The Mexican social security system is funded by​ ________.

workers, employers, and the government


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