Chapter 12 Pearsons Q's

Which of the following pays an employee based on the skills he or she has developed rather than the duties listed for his or her​ job? A. Competency-based pay B. Total rewards C. Broadbanding D. Comparable worth E. Wage curve

A. Competency-based pay

Brad is the chief operations officer of a company that is being acquired. He has been offered a large payment to stay with the company. Which term describes what has been offered to​ Brad? A. Golden parachute B. Annual bonus C. Performance achievement plan D. Premium priced options E. Indexed options

A. Golden parachute

Brad is the chief operations officer of a company that is being acquired. He has been offered a large payment to stay with the company. Which term describes what has been offered to​ Brad? A. Golden parachute B. Performance achievement plan C. Premium priced options D. Indexed options E. Annual bonus

A. Golden parachute Golden parachutes are extraordinary​ (large) payments companies make to executives in connection with a change in company ownership or control.

Which of the following constitutes the largest percentage of executive​ compensation? A. Long-term incentives B. Overtime C. Stock options D. Salary E. Bonuses

A. Long-term incentives the average CEO pay mix was​ 16% salary,​ 22% bonus, and​ 62% long-term incentives.​ Long-term incentives include stock​ options, forgivable​ loans, and golden parachute plans.

By which of the following methods does scientific management try to improve work​ methods? A. Observation and analysis B. Socialization and onboarding C. Interviews and motivation D. Validation and verification E. Instruction and compensation

A. Observation and analysis Observation and analysis enable managers to discover ways to improve​ employees' work methods.

Which term describes the ratio of outputs divided by​ inputs? A. Productivity B. Financial incentives C. Standard hour plan D. Piecework plan E. Variable pay

A. Productivity

Which type of plan features​ cooperation, identity,​ competence, involvement, and​ sharing? A. Scanlon plan B. Employee stock ownership plan​ (ESOP) C. Gainsharing plan D. Team incentive plan E. Profit-sharing plan

A. Scanlon plan In 1937 Joseph Scanlon designed this incentive plan to encourage​ cooperation, involvement, and sharing of benefits. Scanlon plans have five basic​ features: a philosophy of​ cooperation, identity,​ competence, an involvement​ system, and the sharing of benefits formula.

Every year a company pays its employees a percentage of its yearly cost savings. This is an example of​ a(n) ________. A. gainsharing plan B. commission plan C. team incentive plan D. profit-sharing plan E. employee stock ownership plan

A. gainsharing plan Gainsharing plans engage employees in a common effort to achieve productivity objectives and share the gains.

​Stefan's sales representatives spend most of their time servicing accounts and finding new customers. The best pay plan for​ Stefan's team would be a​ _______ plan. A. salary B. merit C. piecework D. straight commission E. variable pay

A. salary Straight salary makes sense when the main task involves prospecting​ (finding new​ clients) or account servicing.

Stacey works on a production line and is paid​ $5 for every item that she produces. Which system is​ Stacey's pay based​ on? A. Variable pay B. A piecework plan C. Commission D. A bonus E. Merit pay

B. A piecework plan Piecework is a system of pay based on the number of items processed by each individual worker in a unit of​ time, such as items per hour or items per day.

Javier was excited to see that his paycheck had an extra​ $100 in it. His boss informed Javier that the additional​ $100 was for all of the extra effort he had put in the last few weeks. Which of the following describes the incentive Javier​ received? A. Variable pay B. A​ lump-sum bonus C. A piecework plan D. Merit pay E. Commission

B. A​ lump-sum bonus Bonuses are generally​ one-time payments.

Rewarding employees for good performance and punishing them for poor performance as a way to change their behavior is the principle behind which motivational​ theory? A. Expectancy B. Behavior modification C. Instrumentality D. Intrinsic motivation E. Scientific management

B. Behavior modification Behavior modification means changing behavior through rewards or punishments that are contingent on performance.

Which of the following pays an employee based on the skills he or she has developed rather than the duties listed for his or her​ job? A. Wage curve B. Competency-based pay C. Broadbanding D. Total rewards E. Comparable worth

B. Competency-based pay

By which of the following methods does scientific management try to improve work​ methods? A. Validation and verification B. Observation and analysis C. Instruction and compensation D. Socialization and onboarding E. Interviews and motivation

B. Observation and analysis

Kim's level in the company entitles her to be part of the incentive​ plan, which awards her​ "units" that are similar to company stock. Kim is part of which of the following types of​ plans? A. Golden parachute B. Phantom stock C. Stock appreciation rights D. Indexed options E. Premium prices options

B. Phantom stock

If Kwong exceeds the standard output set for his​ job, then he will get another​ 15% added to his pay. This scenario describes which type of​ plan? A. Variable pay B. Standard hour C. Commission D. Piecework E. Bonus

B. Standard hour In a standard hour​ plan, a worker is paid a basic hourly rate but is paid an extra percentage of his or her rate for production exceeding the standard per hour or per day.

Every member of the safety team earned a bonus because the team exceeded its goals. This is an example of which of the​ following? A. Gainsharing plan B. Team incentive plan C. Scanlon plan D. Employee stock ownership plan​ (ESOP) E. Profit-sharing plan

B. Team incentive plan

Which of the following is an advantage of a straight commission​ plan? A. The pay of salespeople is consistent. B. The​ company's fixed costs are lower. C. Employees see the plans as fair. D. Salespeople focus on​ non-selling duties. E. Sales performance reflects solely motivation.

B. The​ company's fixed costs are lower. Sales costs are proportionate to sales rather than​ fixed, so the​ company's fixed sales costs are thus lower.

Which of the following plans provides a base salary and a small commission on​ sales? A. Salary plan B. Sales incentive plan C. Combination plan D. Performance recognition program E. Commission plan

C. Combination plan

Which of the following plans is likely to attract high performers and bases pay only on​ results? A. Merit pay B. Bonus C. Commission D. Variable pay E. Piecework

C. Commission

Maria's company has an incentive plan that provides an extra vacation day for any employee that decreases scrap by​ 30%. Maria knows this is practically​ impossible, so she​ doesn't even try to reach the goal. Which of the following explains why Maria is not​ trying? A. Intrinsic motivation B. Instrumentality C. Expectancy D. Behavior modification E. Scientific management

C. Expectancy Expectancy theory states that people​ won't pursue rewards they find unattractive or where the odds of success are very low.

Which of the following is a negative effect of team incentive​ plans? A. Team incentive plans minimize​ problem-solving input. B. Team incentive plans minimize team planning. C. Team incentive plans reward all team members equally regardless of performance level and effort. D. Team incentive plans minimize individual training needs. E. Team incentive plans minimize cooperation between high performers and low performers.

C. Team incentive plans reward all team members equally regardless of performance level and effort.

Every year a company pays its employees a percentage of its yearly cost savings. This is an example of​ a(n) ________. A. employee stock ownership plan B. commission plan C. gainsharing plan D. team incentive plan E. profit-sharing plan

C. gainsharing plan

Sydney is a sales​ representative, and she is paid​ 10% of her total monthly sales. If she has a good​ month, she will save some of the money in case future months are not as lucrative. Sydney is paid under a​ _______ plan. A. piecework B. variable pay C. straight commission D. merit E. standard hour

C. straight commission A straight commission plan pays salespeople for resultslong dash—and only for results. Commissions must be continually earned.

​Profit-sharing plans are examples of​ _______. A. bonuses B. merit pay C. variable pay D. commissions E. piecework

C. variable pay

In which of the following does an employee receive additional pay for production that is above what is​ expected? A. A bonus plan B. A piecework plan C. Variable pay D. A standard hour plan E. Merit pay

D. A standard hour plan

In which of the following does an employee receive additional pay for production that is above what is​ expected? A. Merit pay B. Variable pay C. A piecework plan D. A standard hour plan E. A bonus plan

D. A standard hour plan

Salary grade is the most common factor used to determine an​ employee's eligibility for which of the​ following? A. Gainsharing plan B. Merit pay C. Profit-sharing plan D. Bonuses E. Standard hour plan

D. Bonuses

Which of the following plans is likely to attract high performers and bases pay only on​ results? A. Variable pay B. Merit pay C. Bonus D. Commission E. Piecework

D. Commission

​_______ popularized the practice of offering financial incentives to employees who exceed standards. A. B. F. Skinner B. Frederick Herzberg C. Edward Deci D. Frederick Taylor E. Victor Vroom

D. Frederick Taylor Frederick Taylor popularized using financial incentiveslong dash—financial rewards paid to workers whose production exceeds some predetermined standard.

Which of the following is an example of a social recognition​ program? A. Sales quota award B. Reserved parking space for one month C. Safety award D. Gift certificate E. Employee of the month award

D. Gift certificate

Which of the following constitutes the largest percentage of executive​ compensation? A. Bonuses B. Overtime C. Stock options D. Long-term incentives E. Salary

D. Long-term incentives

​________ typically becomes part of an​ employee's base salary. A. Commission B. Variable pay C. A piecework plan D. Merit pay E. A bonus

D. Merit pay Merit pay is a salary increase awarded to an employee based on his or her individual performance. Merit pay typically becomes part of the​ employee's base salary.

Which type of commission plan would be MOST useful for​ long-term customer​ development? A. Ranking plan B. Quota plan C. Straight commission plan D. Salary plan E. Management-by-objective plan

D. Salary plan

Which of the following pieces of legislation makes executives and board members personally liable if they fail to uphold their financial responsibilities to the company​ shareholders? A. Walsh-Healy Public Contracts Act B. Fair Labor Standards Act C. Davis-Bacon Act D. Sarbanes-Oxley Act E. Equal Pay Act

D. Sarbanes-Oxley Act

Which of the following BEST describes the difference between a stock option and an annual​ bonus? A. A stock option enables employees to give feedback on corporate​ performance; an annual bonus is a cash payment made to reward performance. B. A stock option enables employees to take cash instead of​ stock; an annual bonus is a cash payment made to reward performance. C. A stock option is a cash payment made to reward​ performance; an annual bonus enables employees to purchase corporate stock at a reduced price. D. A stock option enables employees to purchase corporate stock at a reduced​ price; an annual bonus enables employees to take cash instead of stock. E. A stock option enables employees to purchase corporate stock at a reduced​ price; an annual bonus is a cash payment made to reward performance.

E. A stock option enables employees to purchase corporate stock at a reduced​ price; an annual bonus is a cash payment made to reward performance.

Rewarding employees for good performance and punishing them for poor performance as a way to change their behavior is the principle behind which motivational​ theory? A. Expectancy B. Intrinsic motivation C. Instrumentality D. Scientific management E. Behavior modification

E. Behavior modification

Which of the following motivation theories is BEST described as motivation being tied to the idea that effort leads to​ reward, with the reward having perceived value to the​ employee? A. Behavior reinforcement theory B. Motivation theory C. Behavior modification theory D. Incentive pay theory E. Expectancy theory

E. Expectancy theory

Which of the following is an example of a social recognition​ program? A. Safety award B. Reserved parking space for one month C. Sales quota award D. Employee of the month award E. Gift certificate

E. Gift certificate

Which type of commission plan would be MOST useful for​ long-term customer​ development? A. Ranking plan B. Quota plan C. Management-by-objective plan D. Straight commission plan E. Salary plan

E. Salary plan Some firms pay salespeople fixed salaries​ (perhaps with occasional incentives in the form of​ bonuses, sales contest​ prizes, and the​ like). Doing so makes sense when the main task involves prospecting​ (finding new​ clients) or account servicing.