MGMT 3351 - FINAL

What is one of the reasons for the significant growth of companies who began offering discretionary benefits to employees even though they were not required to do​ so? A. Because of the favorable tax treatment of the plans and​ government-imposed wage increase controls B. To compensate for the low wages offered in many industries C. To comply with government requirements regarding worker benefits D. For the improvement of intellectual or social comfort of employees E. To offer employees financial assistance for home purchases and improvements

A. Because of the favorable tax treatment of the plans and​ government-imposed wage increase controls

Based on the criteria for key​ employees, which of the following positions would be considered a key​ employee? A. CEO B. Assistant to the vice president C. Accounts payable clerk D. Senior recruiter E. Director of customer service

A. CEO

Why are​ commission-only sales plans best suited for companies that are pursuing​ lowest-cost strategies? A. Companies using​ commission-only plans have compensation expenditures that vary with sales revenue. B. Companies using​ commission-only plans are not required to give pay raises to employees on a regular basis. C. Companies using​ commission-only plans can pay smaller and smaller commissions on incremental sales. D. ​Generally, in​ commission-only plans, companies pay draws to salespeople but do not provide any incentive pay. E. Companies using​ commission-only plans can avoid paying commission to salespeople if they do not meet their required quota of sales.

A. Companies using​ commission-only plans have compensation expenditures that vary with sales revenue.

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? A. Compressed workweek schedule B. Banking hours schedule C. Flextime schedule D. Contingent workweek E. Telecommuting

A. Compressed workweek schedule

Why are contingent workers perceived as a threat by most labor​ unions? A. Contingent workers tend to threaten​ members' job security. B. Contingent workers are intimidated by employers and thus reluctant to join a union. C. Contingent workers have a divided loyalty between the employment agency and the temporary employer. D. Contingent workers usually seek legal help to address grievances rather than join unions. E.Contingent workers are usually antagonistic towards unions.

A. Contingent workers tend to threaten​ members' job security.

Why are several state legislatures considering integrating​ employer-sponsored medical insurance and​ workers' compensation​ programs? A. Escalating cost increases in​ workers' compensation B. ​Employees' excessive demands for employers to pay for coverage C. ​Employers' unwillingness to share the costs of​ workers' compensation programs D. To provide health benefit provisions for hourly and​ part-time employees E. To eliminate coverage for employees with many dependents

A. Escalating cost increases in​ workers' compensation

How do executives receive an income tax benefit by participating in incentive stock option​ plans? A. 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. B. Executives pay taxes at a flat rate of 2 percent on any profits made when they sell their stock. C. Executives do not pay any taxes on their profits from selling stock. D. Executives pay taxes up front when they purchase the stock at a discounted price. E. Any taxes owed on stock options are covered by the board of directors under a special arrangement on behalf of the executive.

A. 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.

When referring to executive​ compensation, what is meant by the term ​pay-for-failure​? A. Executives receive pay for nonperformance and are given generous amounts to leave the company. B. Compensation consultants recommend higher executive pay even when the company fails to achieve a higher ranking in the industry. C. ​Ironically, executives are better compensated when they fail to make employees work harder. D. Executives perpetuate an overall culture in the company that rewards failure rather than success. E. Executives receive lucrative compensation for taking innovative risks even though they might fail.

A. Executives receive pay for nonperformance and are given generous amounts to leave the company.

What is the primary limitation of a​ two-tier pay​ structure? A. It limits the​ company's ability to recruit and retain qualified workers. B. It increases the total compensation costs for the company. C. It limits a​ company's ability to retain​ senior, experienced workers. D. It leads to discord between workers inside and outside the company. E. It restricts the​ company's ability to award merit pay.

A. It limits the​ company's ability to recruit and retain qualified workers.

What was the motivation behind the Social Security​ Act? A. Preventing families from becoming financially overwhelmed once unemployed B. Motivating employees to be more productive at work C. Making employers responsible for the​ well-being of their employees D. Complying with benefits requirements of the U.S. federal government E. Having employers assume the costs of injuries that happen on the job

A. Preventing families from becoming financially overwhelmed once unemployed

Which of the following statements about the Social Security system is​ TRUE? A. Retirement benefits of​ today's retirees are funded by the current workforce and their employers. B. Not all payroll amounts and wages are taxed under the Social Security system. C. The Social Security system is not a​ pay-as-you-go system. D. The Medicare tax is subject to a wage base. E. ​Self-employed individuals have to pay only 15 percent of the amount required for the Medicare Part A program.

A. Retirement benefits of​ today's retirees are funded by the current workforce and their employers.

How did providing subsistence payments to those who were unemployed or injured help boost the U.S.​ economy, especially after the Great​ Depression? A. Subsistence payments gave unemployed individuals consumption ability to keep the economy afloat. B. Subsistence payments gave subsidies to employers to keep the economy strong and growing. C. Subsistence payments went into funding programs that would help unemployed individuals find work. D. Subsistence payments helped the unemployed become retrained to find work. E. Subsistence payments helped unemployed workers start establishing their own businesses with the money they received.

A. Subsistence payments gave unemployed individuals consumption ability to keep the economy afloat.

Which of the following best describes what a​ well-designed pay structure​ promotes? A. The retention of valued employees B. A​ company-wide balanced budget C. A reduction in payroll costs D. Limiting the number of excess employees E. Identification of which pay system is the best to use

A. The retention of valued employees

What is an advantage associated with offering discretionary​ benefits? A. They can promote particular employee behaviors that have strategic value. B. They lower the chance of product liability lawsuits. C. They can result in lower costs of production. D. They typically increase profits by​ 20% in the first year of their use. E. They usually result in lower material acquisition costs.

A. They can promote particular employee behaviors that have strategic value.

What is the overall view of labor unions regarding​ companies' use of contingent workers and flex​ schedules? A. Unions generally do not support contingent work and flex work schedules. B. Labor unions felt in the past that companies exploited contingent​ workers, but​ don't feel that way anymore. C. Labor unions feel that contingent workers are good for the job security of noncontingent workers. D. Labor unions are in favor of​ companies' use of contingent workers. E. Labor unions would like contingent workers to receive the same benefits as​ full-time workers.

A. Unions generally do not support contingent work and flex work schedules.

When sales professionals are required to perform a significant amount of nonsales​ duties, they should be compensated primarily with​ ________. A. fixed pay B. bonus pay C. incentive pay D. draws E. frequent promotions

A. fixed pay

Generally, the greater the influence of the salesperson on the buying​ decision, the​ ________. A. more emphasis on incentive pay in the compensation mix B. less emphasis on incentive pay in the compensation mix C. less likely that the salesperson will serve as a consultant to the buyer D. less effort will be exerted by the salesperson E. greater the likelihood of receiving a straight​ salary-only plan

A. more emphasis on incentive pay in the compensation mix

Participation requirements are applicable to​ ________. A. pension plans B. ​non-qualified plans C. distribution plans D. qualified plans E. retirement plans

A. pension plans

Which of the following is a stipulation for​ fee-for-service plans? A. ​Fee-for-service plans have no preexisting condition clauses. B. ​Fee-for-service plans require that insured employees are of a certain age. C. ​Fee-for-service plans require employers to pay 100 percent of covered expenses. D. ​Fee-for-service plans do not have a set deductible for all insurance plans. E. ​Fee-for-service plans require the employer to pay all costs up front for employees.

A. ​Fee-for-service plans have no preexisting condition clauses.

Up to what percentage can an employer charge COBRA beneficiaries a premium for continuation​ coverage? A. 36 percent of the cost of the coverage of the plan B. 102 percent of the cost of the coverage of the plan C. 50 percent above the cost of the coverage of the plan D. 90 percent above the cost of the coverage of the plan E. 102 percent of the cost of health expenses incurred by the employee

B. 102 percent of the cost of the coverage of the plan

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. An incentive stock option plan B. A phantom stock plan C. An equity plan D. A capital gains plan E. A golden parachute

B. A phantom stock plan

What is a notable drawback to flexible spending accounts​ (FSAs)? A. They place a limit on the amount an employee can allocate to an FSA. B. An employee must use the accumulated money in the account by a specific time or it will be lost. C. They motivate employees to be less vigilant regarding medical expenses. D. Employees can only use money on​ themselves, not their dependents. E. Hourly employees are not allowed to contribute to an FSA.

B. An employee must use the accumulated money in the account by a specific time or it will be lost.

Which of the following best describes the role of a key employee in an​ organization? A. An employee who has the title of an officer but little authority B. An employee who holds a positon of substantial responsibility C. An employee who works on​ short-term, strategic projects D. An employee who is paid based on performance triggers and their degree of success E. A person who is on the Board of Directors but hold no other role in the organization

B. An employee who holds a positon of substantial responsibility

How has the government encouraged employers to provide retirement benefits to employees since as early as the​ 1900s? A. By imposing a maximum tax rate limit of 10 percent on corporate earnings as long as they provided employee retirement plans B. By giving employers a tax break on the amount paid out as​ employees' retirement payments C. By giving employers an incentive to disallow a union or collective bargaining as long as they provide employee retirement plans D. By giving employers the assurance that they would not be audited as long as they provided employee retirement plans E. By giving employers a tax break on any benefits paid to employees in lieu of a retirement plan

B. By giving employers a tax break on the amount paid out as​ employees' retirement payments

Which statement about designing and planning benefits programs is​ TRUE? A. Employee benefits programs first must be approved by employees before being officially offered to them. B. Companies and union​ representatives, when​ appropriate, should determine which benefits are most important for employees. C. Employee input is required in the development of a​ company's benefits program. D. All​ companies' benefits programs must meet the objective outline in the protection​ programs, paid​ time-off, and services functions. E. Employee benefits programs must include at least two of these three​ functions: protection​ programs, paid​ time-off, and services.

B. Companies and union​ representatives, when​ appropriate, should determine which benefits are most important for employees.

How do employers benefit from compressed​ workweeks? A. Greater control of overhead costs B. Improve recruitment and retention success C. Lower overhead costs D. Greater ability to schedule employees E. Greater control of utilities and support staff

B. Improve recruitment and retention success

Under exclusion provisions for​ short-term disability​ plans, what kind of disability is almost always​ excluded? A. All injuries sustained at home B. Injuries that are​ self-inflicted C. Injuries sustained at work D. All​ stress-related illnesses E. Pregnancy

B. Injuries that are​ self-inflicted

Which authority provides the criteria for defining an​ executive? A. Organization stockholders B. Internal Revenue Code C. U.S. Labor Department D. A board of directors E. U.S. Securities and Exchange Commission

B. Internal Revenue Code

What are the three key laws that have influenced discretionary benefits​ practices? A. ​ERISA, Internal Revenue​ Code, and Fair Labor Standards Act B. Internal Revenue​ Code, ERISA, and Pension Protection Act of 2006 C. National Labor Relations​ Act, Fair Labor Standards​ Act, and Civil Rights Act of 1964 D. National Labor Relations​ Act, Fair Labor Standards​ Act, and Internal Revenue Code E. Internal Revenue​ Code, National Labor Relations​ Act, and ERISA

B. Internal Revenue​ Code, ERISA, and Pension Protection Act of 2006

What can employers do to contain unemployment insurance​ costs? A. Only hire highly skilled and​ well-educated employees B. Monitor their reasons for terminating employees C. Only employ​ part-time hourly employees D. Hire workers based on conditional contracts and stipulations E. Make it a point to lay off workers when they do not need them

B. Monitor their reasons for terminating employees

In which type of selling situation will salary represent a significant pay​ component? A. Furniture store B. Pharmaceutical sales C. Cosmetic sales D. Auto sales E. Home electronics sales

B. Pharmaceutical sales

What is the key difference between target plan bonus and predetermined allocation​ bonus? A. Target plan bonuses are determined in​ advance, but predetermined allocation bonuses can fluctuate. B. Predetermined allocation bonuses are​ fixed; target plan bonuses are not. C. Predetermined allocation bonuses are smaller than target plan bonuses. D. Predetermined allocation bonuses are not determined by the board of​ directors, but target plan bonuses are. E. Target plan bonus amounts are smaller than predetermined allocation bonuses.

B. Predetermined allocation bonuses are​ fixed; target plan bonuses are not.

Of the​ following, which is NOT regulated by ERISA​ (Employee Retirement Income Security Act of​ 1974)? A. life insurance B. Social Security C. disability benefits D. pension program E. medical benefits

B. Social Security

After states have paid into the central unemployment tax​ fund, what happens to the​ money? A. The money is distributed to​ not-for-profit organizations dedicated to helping the unemployed. B. The federal government invests the money and disburses it back to the states as needed. C. The unemployed are able to ask for withdrawals from the central unemployment tax fund to help them buy whatever they need. D. The federal government uses the funds for the training and development of federal employees. E. The federal government puts the money into an emergency account to be used only in times of severe need.

B. The federal government invests the money and disburses it back to the states as needed.

Stock compensation plans generally increase the ownership interest of an executive. What increases the value of a​ stock? A. The number of companies acquired in a given year B. The gain in company performance C. The industry ranking D. The amount of cost savings achieved in a year E. The sales revenue generated

B. The gain in company performance

Due to a potential conflict of​ interest, what is the primary consideration for executive consulting firms who suggest executive pay when refusing to do other work for​ management? A. The respect of labor union members B. The public image of the consulting firm C. The annual revenue of the consulting firm D. The moral principles involved in the decision making E. The costs and benefits of working with CEOs

B. The public image of the consulting firm

Why do businesses use integrated paid time off​ policies, which group together​ holidays, vacation, sick​ leave, and personal leave into a single paid​ time-off policy? A. To comply with new government legislation B. To reduce the number of unscheduled employee absences C. To provide incentives for workers in lieu of pay raises D. To expand employee assistance programs E. To meet increased union demands

B. To reduce the number of unscheduled employee absences

Executives are awarded​ short-term incentive compensation. What is the reason for giving​ short-term incentive compensation to​ executives? A. To reduce their costs by lowering​ company-provided benefits B. To reward executives for meeting intermediate performance criteria C. To increase their commitment to quality in the product or service provided by the company D. To make their company a leader in the industry based purely on sales E. To keep the​ company's payroll costs low

B. To reward executives for meeting intermediate performance criteria

How do companies know when compensation expenditures become​ excessive? A. When companies are paying more to executives than to the majority of their labor force B. When compensation expenditure is greater than quantity and quality of labor output C. When companies pay excessive amounts compared with other global companies D. When companies meet all the financial demands of labor unions E. When companies are not able to meet payroll

B. 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? A. When groups collectively view management from a unified lens B. When groups share the same​ mind-set regarding issues C. When groups start to come together and are hostile towards outsiders D.When groups think creatively regarding solutions to existing issues E. When groups collectively ask for the same kind of pay and benefits

B. When groups share the same​ mind-set regarding issues

Under noncontributory financing for benefits​ programs, ________. A. employers do not contribute to the financing of discretionary benefits B. a firm assumes total costs for each discretionary benefit C. a firm and its employees share the costs D. the state government and the firm share the costs of each discretionary benefit E. the federal government covers the benefits program

B. a firm assumes total costs for each discretionary benefit

The idea behind deferred compensation for an executive is to​ ________. A. keep the interests of the stockholders in mind B. align the​ executive's and​ shareholders' interests in the long term C. keep the interests of the workers of the company in mind D. give the executive a chance to work in the​ executive's best interest E. keep the interests of the board of directors in mind

B. align the​ executive's and​ shareholders' interests in the long term

The current executive core compensation consists of​ ________. A. incentives and merits B. annual base pay and bonuses. C. base pay with possible quarterly stock options D. base pay and a percentage of profits each year E. base pay and benefits

B. annual base pay and bonuses.

For many​ decades, discretionary benefits were​ ________. A. offered to workers for their exceptional performance B. based on the needs of a homogenous workforce consisting mostly of males C. offered to workers who were union members D. offered on the basis of an​ employee's age and physical condition E. offered on the basis of an​ employee's years of service

B. based on the needs of a homogenous workforce consisting mostly of males

The largest percentage of total compensation costs incurred by companies currently is due to​ ________. A. a lack of growth in the amount of funds available to support compensation B. rising health care costs and a lack of growth in the amount of funds available to support compensation programs C. employees demanding increasingly more compensation from their employers D. paying insurance premiums for legal protection from​ compensation-related lawsuits E. employers wanting to provide more benefits to improve employee productivity

B. rising health care costs and a lack of growth in the amount of funds available to support compensation programs

Most​ short-term disability plans pay employees​ ________. A. 100 percent of​ employees' pretax salary with a total limit of​ $30,000 on an annual basis B. 50 percent of​ employees' pretax salary on a monthly or weekly basis C. 60-70 percent of​ employees' pretax salary on a monthly or weekly basis D. 100 percent of​ employees' pretax salary on a monthly or weekly basis E. 60-70 percent of​ employees' pretax salary with a total limit of​ $50,000 on an annual basis

C. 60-70 percent of​ employees' pretax salary on a monthly or weekly basis

Which of the following is NOT a step that compensation professionals use to begin plans for setting the merit pay​ grid? A. Determine if the projected merit increase totals are within the budgeted amount B. Gather data on employee positions in the pay range C. Ask managers for the names of employees receiving merit pay increases D. Calculate the expected number of employees who will fall into each cell E. Ask managers for the performance distribution of their employees

C. Ask managers for the names of employees receiving merit pay increases

Which of the following ensures that employees possess at least a minimally acceptable level of skill proficiency upon completion of a training​ unit? A. Pay ranges B. Pay structure C. Certification D. Skill blocks E. Promotion

C. Certification

Which of the following would contain detailed information on the compensation of a​ firm's CEO and Named Executive​ Officers? A. Separation agreement B. Clawback provision C. Definitive Proxy Statement D. EDGAR E. Golden parachute

C. Definitive Proxy Statement

Which of the following describes the agency​ problem? A. Company shareholders make decisions that benefit other shareholders. B. Company employees look out for themselves by doing the minimum amount of work. C. Executives make decisions in their own​ self-interest. D. Union leaders create pay equity between executive and nonexecutive employees in a company. E. Board members delegate authority to company executives.

C. Executives make decisions in their own​ self-interest.

All of the following are true of the ethical considerations regarding executive pay​ EXCEPT: A. Labor unions argue that pay discrepancies between CEOs and​ non-CEOs are unjust. B. Many members of boards of directors and compensation professionals argue that high pay is necessary to attract executives. C. Most CEOs who are hired from within make more money than those who are recruited from outside the company. D. The typical compensation in equity plans for CEOs is about 50 percent. E. The typical earnings of a fast food cook are a mere​ one-half of 0.18 percent of what an executive makes.

C. Most CEOs who are hired from within make more money than those who are recruited from outside the company.

________ group jobs based on similar compensable factors for the purpose of pay policy application. A. Red circle rates B. Pay compressions C. Pay grades D. ​Compa-ratios E. Green circle rates

C. Pay grades

Which is true when comparing​ non-U.S. CEOs with U.S.​ CEOs? A There is no variation in pay when comparing​ non-U.S. CEOs and U.S. CEOs. B. The range of pay and composition of pay among​ non-U.S. CEOs is not very wide. C. Pay mix is substantially different among CEOs in various countries. D. Countries globally provide detailed data on total compensations of​ CEOs, which makes comparison with U.S. executive pay easier. E. U.S.​ CEOs, are generally paid a salary but do not recieve​ bonuses, whereas CEOs in most other countries are paid significant performance bonuses

C. Pay mix is substantially different among CEOs in various countries.

Which is true of merit pay​ increases? A. Merit pay should be awarded equally across the board for it to be meaningful. B. Merit pay should be substantive in the absolute​ sense, not a relative​ sense, for the employee. C. Research shows that boosting merit pay will not necessarily increase productivity. D. Merit pay can be administered regardless of the level of funding for merit pay. E. Merit pay is not viewed by employees as having any relationship to​ cost-of-living adjustments.

C. Research shows that boosting merit pay will not necessarily increase productivity.

Which act was established to regulate the implementation of employee benefits​ programs, thereby protecting employee benefits​ rights? A. The Fair Labor Standards Act B. The Civil Rights Act of 1964 C. The Employee Retirement Income Security Act of 1974 D. The National Labor Relations Act E. The Patient Protection and Affordable Care Act of 2010

C. The Employee Retirement Income Security Act of 1974

Which statement about commissions is​ TRUE? A. Commission plans generate cohesiveness among most sales professionals. B. As​ incentives, commissions are considered the best tactic for compensating sales professionals. C. The intrinsic motivation of some sales professionals is undermined by​ commission-only plans. D. Younger sales professionals typically prefer​ commission-only plans much more than older sales professionals. E. Commissions interfere with the​ cost-cutting measures of most organizations.

C. The intrinsic motivation of some sales professionals is undermined by​ commission-only plans.

Why would a company provide outplacement assistance to an​ employee? A. To avoid legal complications when terminating employees B. To comply with federal regulations during company layoffs C. To promote a positive image of the company D. To satisfy the demands of unions E. To address safety issues at work because laid off employees are a threat to a company

C. To promote a positive image of the company

What is the focus of the economic realities test for independent​ contractors? A. Whether the worker operates as an individual contractor B. Whether the worker should be provided with protective benefits C. Whether the worker qualifies as an employee D. Whether employment laws are applicable to the worker E. Whether the worker truly needs a​ full-time job

C. Whether the worker qualifies as an employee

If an employer offers a pension​ plan, employees must be allowed to participate in pension plans after they have reached​ ________ and have completed​ ________ of service. A. a certain status within the​ company; 1 year B. age​ 25; 3 years C. age​ 21; 1 year. D. age​ 35; 5 years E. a certain status within the​ company; 5 years

C. age​ 21; 1 year.

Unions in the public sector feel that flex schedules​ ________. A. are the primary cause of a lack of productivity B. are a big reason for employee tardiness C. are​ acceptable, because they strengthen union bargaining power D. produce more labor union members E. in the public sector exploit workers much more than in the private sector

C. are​ acceptable, because they strengthen union bargaining power

Pay rates that fall along the market pay line represent​ ________. A. labor union-determined pay rates negotiated and agreed upon by the company B. bonus pay awarded to workers on a random basis C. competitive pay rates based on relevant labor market D. minimum wage rates as determined by the government E. incentive pay historically paid by the company

C. competitive pay rates based on relevant labor market

The Pension Benefit Guaranty Corporation​ (PBGC) was created to​ _______. A. help the government collect revenue from companies for unemployment protection payments B. help employees file legal claims against their employers when employers fail to make retirement payments C. insure retirement income for workers covered under a​ private-sector defined benefit plan D. ensure that employers offer defined benefits to those workers who have been with the company 10 years or more E. help employees obtain permanent retirement income from companies in case of disability

C. insure retirement income for workers covered under a​ private-sector defined benefit plan

Flextime schedules allow workers to​ ________. A. reduce the total number of hours worked during the week B. choose schedules that are most convenient for them C. modify their work schedules within the limits set by the employer D. telecommute from a home office as needed E. use the weekend to make up any work hours missed during the workweek

C. modify their work schedules within the limits set by the employer

In a​ ________, employees earn a higher rate of commission for all sales made in a given period if the sales level exceeds a predetermined level. A. ​commission-only plan B. ​draw-only plan C. multiple-tiered commission plan D. ​salary-only plan E. graduated commission plan

C. multiple-tiered commission plan

Merit pay systems use​ ________ to determine​ employees' performance. A. the​ employee's job title B. the labor​ union's input C. performance appraisals D. seniority E. customer feedback

C. performance appraisals

When considering executive​ compensation, boards of directors are theoretically representing the interests of​ ________. A. labor leaders B. blue collar workers C. shareholders D. government agencies E. competitors of the firm

C. shareholders

Individuals who meet the eligibility criteria for unemployment benefits receive​ ________ benefits. A. yearly B. daily C. weekly D. quarterly E. monthly

C. weekly

When determining pay structure based on geographical​ consideration, many employers consider the​ ________. A. payroll taxes in a given area B. insurance costs in a given area C. ​cost-of-living adjustment for a certain area D. sales taxes in a given area E. minimum wage in a given area

C. ​cost-of-living adjustment for a certain area

With regard to​ FUTA, the amount that an employer contributes is equal to​ ________ of the first​ ________ earned by each employee. A. 5.2​ percent; $5,500 B. 2​ percent; $40,900 C. 6.2​ percent;$40,900 D. 6.2​ percent; $7,000 E. 5​ percent; $7000

D. 6.2​ percent; $7,000

Which statement regarding executive compensation is​ TRUE? A. The sales of a company are not considered a performance measure to determine executive compensation. B. Shareholder returns have no bearing on executive compensation. C. Research indicates that most executives are compensated unfairly for their performance. D. Academic research is not decisive regarding a connection between executive compensation and company performance. E. Executives are compensated based on how they are perceived by their employees.

D. Academic research is not decisive regarding a connection between executive compensation and company performance.

What is one of the most difficult tasks managers face when they guide employees towards​ person-focused pay? A. Making employees understand the incentive pay structure B. Trying to help employees understand the connection between seniority and​ person-focused pay systems C. Helping employees understand how training relates to the performance appraisal system D. Aligning employee pay with the knowledge structure E. Making employees understand the base pay structure

D. Aligning employee pay with the knowledge structure

How can employers involve employees in the benefits determination​ process? A. By requiring that all employees understand the kinds of benefits they are allowed to receive B. By asking employees to design surveys to gather data about employee benefits preferences C. By having employees compose their own benefits plans and submitting them for review to an HR manager D. By conducting employee interviews and focus groups E. By asking employees to conduct benchmark studies on benefit plans

D. By conducting employee interviews and focus groups

Who is exempt from​ COBRA? A. Employers who agree to provide excellent health benefits to their employees B. Companies with fewer than 50 employees C. Employers who agree never to disclose or transfer their​ employees' health information D. Companies with fewer than 20​ employees, church​ plans, and plans maintained by the U.S. government E. Employers and government plans that guarantee coverage for an​ employee's dependents

D. Companies with fewer than 20​ employees, church​ plans, and plans maintained by the U.S. government

What change occurred with the passing of the​ PPACA? A. Employers can now purchase cheaper insurance plans with lower maximum benefits limits. B. There are now limits to benefits for health insurance plans. C. Coinsurance for employees is no longer an option. D. Employers are no longer able to purchase insurance plans with lower maximum benefits at a lower cost. E. Employers are required to​ self-fund the insurance plans they provide.

D. Employers are no longer able to purchase insurance plans with lower maximum benefits at a lower cost.

Which statement about flexible spending accounts​ (FSAs) is​ TRUE? A. FSAs have no dollar limits per year. B. FSAs can be funded on an​ after-tax basis only. C. FSAs allow unused funds to be rolled over to another year. D. FSAs allow certain benefits​ (like child​ care) to be paid with pretax dollars. E. FSAs are matched dollar for dollar by employers.

D. FSAs allow certain benefits​ (like child​ care) to be paid with pretax dollars.

What is a key principle of​ workers' compensation? A. For injuries and accidents that occur on the​ job, the labor union and the employer must equally share the medical costs. B. For injuries and accidents that occur on the​ job, employees must assume the costs. C. For injuries and accidents that occur on the​ job, medication costs are paid by the employer but any hospitalization costs are paid by the worker. D. For injuries and accidents that occur on the​ job, employers must assume the costs. E. For injuries and accidents that occur on the​ job, employers and employee assume the costs equally.

D. For injuries and accidents that occur on the​ job, employers must assume the costs.

What was a common occurrence during the early twentieth century that led to​ workers' compensation​ insurance? A. Many employers not allowing regular work​ breaks, which caused workers to have​ fatigue-related illnesses B. Employers demanding long working​ hours, which caused health issues for workers C. Workers being required to handle harmful​ chemicals, which caused many health concerns D. Industrial accidents and occupational illnesses among workers E. Industrial hygiene not being a concern for many​ employers, which caused​ work-related illnesses

D. Industrial accidents and occupational illnesses among workers

With regard to financing​ programs, what are the three categories from which human resources managers can​ choose? A. ​Employee-first programs,​ low-cost programs, and contributory programs B. Noncontributory​ programs, contributory​ programs, and core plus options programs C. Employee-first programs,​ low-cost programs, and​ employee-financed programs D. Noncontributory​ programs, contributory​ programs, and​ employee-financed programs E. ​Cost-containment programs, government financing​ programs, and core plus options programs

D. Noncontributory​ programs, contributory​ programs, and​ employee-financed programs

Under which of the three broad categories for discretionary benefits does disability insurance​ fall? A. Services B. Voluntary programs C. Paid time off D. Protection programs E. Safety programs

D. Protection programs

What are the three categories of discretionary​ benefits? A. Outplacement​ programs, wellness​ programs, and sick leave B. Disability​ insurance, sick​ leave, and employee assistance programs C. Employee assistance​ programs, family assistance​ programs, and tuition reimbursement D. Protection, paid time​ off, and services E. Disability​ insurance, life​ insurance, and retirement programs

D. Protection, paid time​ off, and services

What entities are typically exempt from​ FUTA? A. Private businesses with diversity hiring practices B. International companies C. ​Not-for-profit companies and​ for-profit companies that donate funds D. State and local governments and​ not-for-profit companies E. Any business that employs fewer than 20 employees

D. State and local governments and​ not-for-profit companies

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? A. Compressed workweek schedule B. Flextime schedule C. Banking hours schedule D. Telecommuting E. Job sharing

D. Telecommuting

How do companies create an ownership interest for an​ executive? A. Through offering a guaranteed lifetime income B. Through promising a fixed percentage of total amounts saved in a given year C. Through guaranteeing a percentage of the profits D. Through granting stock and stock options E. Through increasing the bonus amounts each year

D. Through granting stock and stock options

Which of the following rewards newly hired employees less than established or tenured​ employees? A. Broadbanding B. Commission-only plans C. Pay compression D. Two-tier pay structures E. Salary-only plans

D. Two-tier pay structures

How are welfare practices​ defined? A. Monetary support given to people in need B. Lawful procedures or social efforts designed to stimulate the basic physical and material​ well-being of people in need C. A person or​ group's health,​ happiness, and old age retirement D. Voluntary benefits paid by the employer that are for the intellectual or social development of the employees E. Anything for the professional development of an employee to increase wage earning potential

D. Voluntary benefits paid by the employer that are for the intellectual or social development of the employees

COBRA was designed to​ ________. A. prevent employees from continuing their medical coverage through their employer for an extended period of time if coverage must discontinue because of layoffs B. set limits on the amount of time that health plans and insurance issuers may impose​ pre-existing health conditions C. guarantee​ employees' health insurance coverage under a different​ employer's health plan should they choose to leave their previous​ employer's group health plan D. allow employees to continue with their medical coverage through their employer temporarily E. protect the transfer of health care information

D. allow employees to continue with their medical coverage through their employer temporarily

Long-term disability plans usually state that​ _______. A. there should be no waiting period for an employee before the employee can apply for​ long-term disability income B. employees are eligible only if they did not have a​ pre-existing condition at the start of the plan C. an employee should have a waiting period of three months after the expiration of​ short-term benefits D. an employee has to wait three to six months before disability payments are made following an illness or injury E. an employer should cover the employee even before the sick leave or​ short-term benefits run out

D. an employee has to wait three to six months before disability payments are made following an illness or injury

Currently, most of the benefits plans offered by companies are​ ________. A ​employee-financed B. a combination of noncontributory and​ employee-financed C. noncontributory D. contributory E. a combination of contributory and​ employee-financed

D. contributory

Flex work schedules are best for companies that want to promote differentiation strategies. This is because flex schedules​ ________. A. are preferred by unions that push for differentiation strategies B. over the long run pay more to the​ employees, which makes them more motivated C. help employees work with other employees across the globe D. help employees work without being distracted by personal matters E. bring together teams that can work creatively

D. help employees work without being distracted by personal matters

Job sharing at work is an arrangement where​ ________ A. a single employee is hired simultaneously by two different companies B. two employees assist a​ full-time employee C. two or more employees are matched up to work together on an​ as-needed basis D. two or more​ part-time employees perform a single​ full-time job E. one employee works in two different departments

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

What are the key aspects of​ vesting? A. Cliff vesting requires 2 years of service and gradual vesting requires 3 years of​ service; 100% vesting occurs after 6 years of service. B. Cliff vesting begins after 6 years of service and gradual vesting begins after 3 years of service. C. Cliff vesting provides full vesting after 1 year of service for full time employees and gradual vesting for 3 years for​ part-time employees. D. ​Employees' contributions to pension plans are always vested and a company is required to give full vesting rights to employer contributions based on a predetermined schedule. E. ​Employees' contributions to pension plans are always​ vested, a company is required to give full vesting rights to employer​ contributions, and it must use a gradual vesting schedule.

D. ​Employees' contributions to pension plans are always vested and a company is required to give full vesting rights to employer contributions based on a predetermined schedule.

What type of a compensation plan is best suited for a salesperson who dislikes having to attain a specific volume of sales and who prefers concentrating on presale and​ post-sale activities? A. ​Commission-only plan B. ​Salary-plus-commission plan C. ​Salary-plus-bonus plan D. ​Salary-based sales plan E. ​Commission-plus-draw plan

D. ​Salary-based sales plan

Which term refers to a salesperson receiving a set salary plus a single payment for the achievement of​ specific, exceptional​ goals? A. ​Salary-plus-commission B. ​Salary-plus-draw plan C. ​Salary-only-plan D. ​Salary-plus-bonus plan E. ​Commission-only plan

D. ​Salary-plus-bonus plan

A cliff vesting schedule requires that an employee be 100 percent vested after​ ________ years of service. A. 2 years B. 10 years C. 7 years D. 5 years E. 3 years

E. 3 years

Involuntary​ part-time employees work fewer than​ ________ hours per week. A. 15 B. 40 C. 25 D. 50 E. 35

E. 35

When determining who receives​ coverage, companies usually withhold discretionary benefits to probationary​ employees, which are typically employees working at a company for a period no longer than​ ________. A. 2 months B. 6 weeks C. 1 year D. 5 months E. 6 months

E. 6 months

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. A. 30 B. 25 C. 45 D. 10 E. 60

E. 60

For employees who participate in job​ sharing, which of the following is a likely​ benefit? A. Option to earn more vacation days B. Ability to work on a seasonal basis C. Opportunity to work from a home office D. Enhanced personal relationships in the workplace E. Ability to participate in an employee retirement program

E. Ability to participate in an employee retirement program

In the​ 1930s, how did unions influence businesses offering discretionary benefits to their​ employees? A. By requiring businesses to share a minimum percentage of their profits for retirement plans B. By petitioning that all businesses be unionized in order to offer the most benefits possible to employees C. By standardizing the discretionary benefits that businesses can offer employees D. By requiring that all​ businesses, union and​ nonunion, give employees discretionary benefits E. By pushing for the National Labor Relations​ Act, which legitimized bargaining for benefits

E. By pushing for the National Labor Relations​ Act, which legitimized bargaining for benefits

Which term refers to an incentive compensation based on the percentage of the selling price of a product or​ service? A. Nonrecoverable draw B. Salary C. Draw D. Recoverable draw E. Commission

E. Commission

Carissa and her colleagues have received an annual merit pay increase on June 15 for the last two years. What is the term used to define the date when Carissa and her colleagues receive the annual merit​ increase? A. Performance review date B. Merit pay raise date C. Compensation budget date D. Employee anniversary date E. Common review date

E. Common review date

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? A. Labor unions are concerned about the safety and health of their members. B. Contingent employees are likely to go away in the near future. C. Contingent employees pay smaller union dues than core employees. D. Contingent employees are not always labor union members. E. Contingent employees are paid less and have fewer benefits.

E. Contingent employees are paid less and have fewer benefits.

If you are​ self-employed, what does the​ Self-Employment Contributions Act​ (SECA) require you to​ do? A. Partner with nonprofit companies to reduce tax burdens B. Contribute equally to your fund and your​ employees' funds C. Design and implement health and fitness programs for your workers D. Provide facilities that support the ideal working conditions to minimize chances of employee injuries E. Contribute to Medicare and OASDI at a higher tax rate

E. Contribute to Medicare and OASDI at a higher tax rate

Which of the following statements is FALSE regarding flexible work​ schedules? A. Flexible work schedules benefit employees by helping them balance work and family demands. B. Flextime and compressed workweeks are the most common flexible work schedules in many firms. C. Flexible work schedules are valued greatly by employees D. Flexible work schedule practices apply to both core and contingent employees. E. Flexible work schedules can reduce productivity.

E. Flexible work schedules can reduce productivity.

Leasing employees to a client company is common in which type of​ industry? A. Housing B. Entertainment C. Financial D. Manufacturing E. Food

E. Food

Which statement about the annual base pay for an executive is​ TRUE? A. It takes a short amount of time before the strategic decisions taken by a CEO pay​ off, thus justifying the​ CEO's salary. B. The IRS does not limit the amount of an​ executive's annual pay that can be categorized as a business expense. C. A target plan bonus ties cash bonuses to the executive attaining specific performance criteria. D. It is very easy to set the annual base pay for a CEO because of the predictability of internal and external factors. E. For most​ executives, annual base pay represents a small part of their total compensation.

E. For most​ executives, annual base pay represents a small part of their total compensation.

What is a key difference between a health reimbursement account​ (HRA) and a flexible spending account​ (FSA)? A. Employees contribute to HRA​ accounts, but not to FSA accounts. B. FSAs allow employees to carry over unused​ amounts, but HRAs do not. C. HRAs require employees to forfeit the leftover amount within the account at the end of the​ year, but in an FSA​ account, the amount can be rolled over. D. Employees partially fund their​ FSAs, but they are required to fully fund HRA accounts. E. For​ FSAs, employees can make​ contributions, but in​ HRAs, they cannot

E. For​ FSAs, employees can make​ contributions, but in​ HRAs, they cannot

What is one of the requirements of the​ Davis-Bacon Act? A. It requires private contractors to give the minimum wage as set by the state. B. It requires government agencies to match the wage rates to prevailing wages paid by private contractors. C. It requires private companies to match wages paid by government agencies. D. It requires private contractors who employ more than 15 workers to pay​ $10 above the minimum wage rate. E. It requires private contractors to provide wages that are equal to or above the prevailing wage rates in the area where work is being performed E. It requires private contractors to provide wages that are equal to or above the prevailing wage rates in the area where work is being performed..

E. It requires private contractors to provide wages that are equal to or above the prevailing wage rates in the area where work is being performed..

What is a​ draw? A. An employee incentive B. An increase in base pay C. A type of merit pay D. A bonus payment E. Money to cover basic living expenses

E. Money to cover basic living expenses

Which statement about temporary employment agencies is​ TRUE? A. Firms that need to hire a variety of workers should use specialized temporary agencies. B. In the​ past, most temporary agencies primarily placed manufacturing workers. C. All temporary agency fees are the same and based on the current minimum wage rate. D. Temporary agencies are less common now because of an increase in​ part-time jobs. E. Temporary agency fees are based on a percentage of a​ placement's pay rate.

E. Temporary agency fees are based on a percentage of a​ placement's pay rate.

How are HMOs and​ fee-for-service plans the​ same? A. They both operate on a reimbursement basis. B. They both offer prepaid services. C. They both have low coinsurance rates. D. They both use primary care physicians as a​ cost-control measure. E. They both have​ out-of-pocket maximum limits.

E. They both have​ out-of-pocket maximum limits.

Which of the following statements is TRUE of core plus option​ plans? A. They allow employees to pay for their core benefits expenses with pretax dollars. B. They allow an employee to have one core benefit plus one additional benefit of their choosing added on. C. They allow employees to choose only one kind of benefit. D. They allow an employee to have one core benefit plus two additional benefits of their choosing added​ on, making up the whole of their benefits plan. E. They extend a preestablished set of​ benefits, such as medical​ insurance, as a program core.

E. They extend a preestablished set of​ benefits, such as medical​ insurance, as a program core.

What is a potential cost associated with extensive discretionary benefits​ programs? A. They may make recruiting more difficult. B. They usually lead to higher turnover rates. C. There are no tax advantages associated with discretionary benefits. D. They usually lead to higher absenteeism rates. E. They may also undermine the imperatives of strategic compensation efforts.

E. They may also undermine the imperatives of strategic compensation efforts.

Which group of workers chooses to work fewer than 35 hours per regularly scheduled​ workweek? A. Temporary employees B. Involuntary​ part-time employees C. Consultants D. Leased employees E. Voluntary​ part-time employees

E. Voluntary​ part-time employees

Which of the following statements about coverage for disability benefits is​ FALSE? A. The disability must be expected to last for at least one year or to result in death. B. Becoming disabled at 29 would mean needing credit for four years of employment. C. Disability is based on the inability to do the original work assigned or any type of new work because of the medical condition of the disabled worker. D. Young workers need fewer quarters of coverage because they have had fewer years to accumulate them. E. Younger workers need more quarters of coverage because of their young age and inexperience.

E. Younger workers need more quarters of coverage because of their young age and inexperience.

Part-time employees are eligible for retirement benefits if they​ ________ and​ have________. A. work in the public​ sector; a​ high-school diploma B. work in the public​ sector; a college degree C. are 18 years of age or​ older; 500 hours logged in an​ 18-month period D. are 30 years of age or​ older; a college degree E. are 21 years of age or​ older; 1,000 hours logged in a​ 12-month period

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

One of the ways companies can use discretionary benefits is to​ _________. A. pursue​ lowest-cost strategies to gain market share B. lower employee expectations regarding future pay raises C. reduce the​ firm's chances of​ compensation-related lawsuits D. limit the amount of overtime pay given to workers E. encourage certain worker behaviors that have strategic value to the firm

E. encourage certain worker behaviors that have strategic value to the firm

Temporary workers are primarily hired by companies to​ ________. A. serve as consultants B. share jobs with​ full-time workers C. provide strong technical skills D. be on call for other employees E. fill a need during peak times

E. fill a need during peak times

Technically, when contingent workers are placed in an​ organization, they are​ ________. A. entitled to the same benefits as those who work​ full-time B. paid the same base rate as any other worker C. accountable to the union in the company where they are placed D. considered​ full-time employees of the company in which they were placed E. legally accountable to the temporary employment agency that hired them

E. legally accountable to the temporary employment agency that hired them

The first pension plan was established to specifically benefit​ ________. A. widows and children of military veterans B. former railroad employees C. any soldier who fought in World War II D. individuals who were employed​ full-time E. widows and children of Presbyterian ministers

E. widows and children of Presbyterian ministers

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​ ________. A. strength of the labor union in the company B. financial condition of the company C. amount of total compensation for nonexecutive employees in the company D. total revenue from the product or service provided by the company E. number of employees in the company

B. financial condition of the company

Employee assistance programs​ (EAPs) are established by companies to help employees​ ________. A. receive additional job training at no cost B. handle personal problems that affect job performance C. facilitate flexible scheduling D. manage conflicts between workers and supervisors E. provide child care and elder care programs for workers

B. handle personal problems that affect job performance

The three broad areas in which employers provide discretionary benefits are​ ________. A. protection​ programs, paid time​ off, and services B. disability​ insurance, employee assistance​ programs, and family assistance programs C. disability​ insurance, life​ insurance, and retirement programs D. tuition​ reimbursement, outplacement​ assistance, and wellness programs E. wellness​ programs, financial​ education, and outplacement assistance

A. protection​ programs, paid time​ off, and services

The dual employer doctrine law states that temporary workers have a right to​ _________ A. workers' compensation B. retirement benefits C. receive tuition reimbursement D. claim transportation costs E. receive protective benefits like health and dental care

A. workers' compensation

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. The​ executive's job performance during the year B. The amount of revenue generated during the year C. A​ company's position ranking in the relevant industry D. The recommendation of the board of directors E. A​ company's profits

E. A​ company's profits

From an​ employer's perspective, job sharing is likely to result in​ ________. A. increasing payroll costs B. losing highly skilled workers C. hiring workers for​ short-term projects D. outsourcing more​ service-related tasks E. reducing employee training costs

E. reducing employee training costs

For the​ employee, flexible workweek schedules have the greatest impact on​ ________. A. bonus and incentive pay B. paid​ time-off benefits C. determining overtime pay D. health care benefits E. determining core compensation

B. paid​ time-off benefits

When the pay spread between newly hired or less qualified employees and more qualified job incumbents is​ small, it is known as​ ________. A. a green circle rate B. pay compression C. a red circle rate D. broadbanding E. a pay grade

B. pay compression

Under the principle of social​ adequacy, benefits are designed to​ _____. A. help employees feel better about their total compensation package B. provide subsistence income to all beneficiaries regardless of job performance C. help employees who have no health issues to remain active and fit D. reward those who show superior interpersonal skills in the workplace E. provide motivation for superior performance by employees

B. provide subsistence income to all beneficiaries regardless of job performance

Coinsurance refers to​ ________. A. the amount a policy holder must pay before insurance benefits are applicable B. the maximum amount a policy holder must pay out of pocket C. where the employer is responsible for 25 percent of incurred medical expenses of the employee D. when the employer and the employee split equally the medical expenses incurred by the employee E. the percentage of the covered expense that the insured person will pay

E. the percentage of the covered expense that the insured person will pay

Executives must have​ ________ percent of ownership in a firm before they are classified as a highly compensated employee by the Internal Revenue Code​ (IRC). A. 15 B. 10 C. 33 D. 5 E. 20

D. 5