Quiz #3
The most frequently used incentive system is the: A. standard hour plan. B. straight piecework system. C. Merrick system. D. Taylor differential piece-rate plan.
B
Which of the following benefits is NOT mandated by state or federal legislation? A. Workers' compensation B. Work/life balance C. Social security D. Unemployment insurance
B
A _____ plan requires division of a task into simple actions and determination of the time required by an average skilled worker to complete each action. A. standard hour B. Rowan C. Bedeaux D. Merrick
C
All of the following are categories of rater training EXCEPT _____ training. A. rater- error B. performance- standard C. behavior modeling D. performance- dimension
C
In which of the following jobs is it most appropriate to use behaviorally anchored rating scales? A. The job of a trainer that requires training new employees every month B. The job of a web designer that requires designing websites according to client expectations C. An assembly line job that requires tightening nuts on an engine D. A client relations job that requires bringing in new clients to a firm
C
Which of the following statements is true of individual spot awards? A. They are an example of long-term incentives. B. They are more expensive than merit pay increases. C. They are given to employees for exceptional performance as an add- on bonus. D. They are given to all employees as a one-time cost-of-living adjustment.
C
Which of the following types of rankings would be least preferred by managers of more than 10-15 employees? A. Straight ranking B. Alternation ranking C. Paired-comparison ranking D. Forced distribution ranking
C
_____ have the disadvantage of requiring employees to spend money to obtain their incentive. A. Cash profit sharing plans B. Balanced scorecard plans C. Stock options plans D. Deferred profit sharing plans
C
If a benefit forecast suggests future cost containment may be difficult, the benefit should: A. be completely paid for by employees. B. be used on a noncontributory basis. C. not be used. D. be offered to employees only on a cost-sharing basis.
D
When a job involves very routine, mechanistic tasks, the most appropriate appraisal format is: A. BARS. B. MBO. C. standard rating scales. D. alternation ranking.
A
All of the following are cost-containment practices designed to reduce benefit costs EXCEPT: A. probationary periods. B. provision of skills development training. C. copa y. D. seeking competitive bids for benefit delivery.
B
By limiting liability for an employee's hospital stay costs to $200,000, an employer is using a cost-containment measure known as: A. dual coverage. B. benefit ceiling. C. coinsuranc e. D. deductibl e.
B
According to available evidence, companies can successfully remain nonunion by offering the same benefits as those provided by unionized firms.
F
Agency theory argues that employees prefer risky pay as rewards can be greater than a salary.
F
All employee benefits provided by employers are taxable.
F
An advantage of group incentives is that it leads to increased line-of-sight.
F
Group pay is always more effective than individual pay.
F
In the long run, merit bonuses cost employers less than merit pay.
T
Performance plans typically feature corporate performance objectives for a time three years in the future.
T
Standard hour plans are better for nonrepetitive jobs requiring numerous skills for completion.
T
Louie received the highest performance rating and is in the second quartile of his pay range. He received a pay increase of 8 percent. Bart also received the highest performance rating and is in the fourth quartile. Given the way most merit increase grids work, what size of pay increase would you expect Bart to receive? A. Less than 8 percent B. More than 8 percent C. 8 percent D. There is no relationship between ratings and position in pay range.
A
The _____ requires individuals to maintain minimal essential health insurance coverage or pay a penalty unless exempted for religious beliefs or financial hardship. A. Patient Protection and Affordable Care Act B. Family and Medical Leave Act C. Health Maintenance Organization Act D. Consolidated Omnibus Budget Reconciliation Act
A
According to the agency theory, because employees prefer a salary, they will demand a wage premium in exchange for accepting performance-based pay.
T
All incentive plans share an established standard against which worker performance is compared to determine the magnitude of the incentive pay.
T
An important implication of reinforcement theory is that the timing of payouts to employees is very important.
T
Benefits can be an effective tool to attract and retain employees when the benefits address the needs of a target group.
T
Evidence suggests that talented people are motivated to join organizations with strong links between performance and pay.
T
For the same level of performance, employees low in a pay range receive higher percentage increases than employees higher in the range.
T
Group incentive pay increases turnover of better performers, while individual incentive increases turnover of poorer performers.
T
One of the best strategies for determining external equity is to conduct a benefit survey.
T
Performance-standard training provides raters with a standard of comparison or frame of reference for making appraisals.
T
Risk-sharing plans include a provision for cuts in base pay that are only recaptured in years when an organization meets performance objectives.
T
Security in terms of compensation refers to the predictability of one's paycheck from one time to the next.
T
Some experts argue that applying total-quality-management principles to performance appraisals can improve them.
T
When pay raises are based on events over which employees lack significant control, they are likely to regard the system as unfair.
T
Workload and work variety are both components of a total reward system.
T
The authors argue that for merit pay to live up to its potential, all of the following should be done EXCEPT _____. A. using more peer raters than supervisor raters B. improving the accuracy of appraisals C. allocating enough merit money to truly reward performance D. ensuring the size of the merit increase differentiates across performance levels
A
Company X pays for performance. Allan, an employee of the company, is not in favor of this reward system and, therefore, leaves Company X in search of another company with different rules for getting rewards. This is an example of the: A. design effect. B. compensation effect. C. sorting effect. D. incentive effect.
C
How many weeks of leave does Family Medical Leave Act (1993) mandate for all workers at companies that employ 50 or more people? A. 4 weeks B. 8 weeks C. 12 weeks D. 16 weeks
C
In 1959, benefits were approximately _____ percent of payroll and in 2010 it was approximately _____ percent of payroll. A. 30; 50 B. 20; 38 C. 25; 30 D. 30; 60
C
Available evidence indicates managers believe the most important factor for pay increases is _____. A. experience B. nature of theJob C. seniority D. performance
D
Pension costs are of no concern to employers as the government handles the pension costs.
F
Rankings are more popular among managers than ratings as they are less complex.
F
Scanlon plans are designed to lower labor costs by lowering the level of a firm's activity.
F
Subordinate ratings are more accurate when they are not anonymous.
F
The total-quality-management advocates contend that informing raters that the work environment has more influence on performance than individual employee behavior will make the raters' rate lower.
F
When raters must justify their scoring of subordinates in writing, the rating is less accurate.
F
When a firm is _____ on business risk, and its outcomes are _____, its performance is more likely to be higher without any incentive plans. A. variable; certain B. high; uncertain C. low; certain D. low; invariable
B
Which of the following statements about merit pay is NOT true? A. It has a small but significant effect on performance. B. Removal of merit pay lowers satisfaction but not performance. C. Departments and units with merit pay show higher performance. D. Merit pay has a sorting effect.
B
_____ are NOT used for determining employee benefit preferences. A. Demographic data B. Product market share data C. Employee surveys D. Cafeteria-style plans
B
A person with low self-esteem is likely to seek _____. A. a small, hierarchical organization with pay plans based upon individual performance B. a flat organization with a significant amount of pay based upon performance C. a small organization with large benefits based on group performance D. a large, decentralized organization with little performance- based pay
D
A study of ratings of managers found that approximately only _____ percent of the managers were rated below average. A. 30 B. 20 C. 10 D. 5
D
All of the following EXCEPT _____ require periodically re-earning the added pay. A. success-sharing plans B. merit bonuses C. profit-sharing plans D. cost-of-living increases
D
Surveys show the most popular type of variable pay plans are _____. A. stock option plans B. gainsharing plans C. individual incentive plans D. special recognition plans
D
Which of the following is NOT a strength of supervisors as raters? A. They are knowledgeable about subordinates' jobs. B. Their ratings are immune to halo and leniency errors. C. Supervisors have rating experience. D. They assign work to subordinates.
B
Which of the following is the most commonly used team incentive performance standard? A. Quality of goods B. Customer satisfaction measures C. Financial performance D. Quality of services
B
Which of the following statements is true of employee benefits? A. Employers can substitute insurance benefits for job security. B. Group insurance benefits has relatively easy qualification standards. C. Most employee benefits are taxable. D. Many group-based benefits are obtained at a higher rate than could be obtained by employees acting on their own.
B
Which of the following theories states that people choose the behavior that leads to the greatest reward? A. Maslow's need theory B. Expectancy theory C. Herzberg's two-factor theory D. Goal-setting theory
B
A benefit plan that allocates a set dollar amount to employees and allows them to select benefits is called _____ plan. A. a select choice B. a no- deductible C. a flexible benefit D. a flat dollar benefit
C
Among peer raters, the most objective evaluations are given by: A. workers who are friends of the ratees. B. workers who are not close friends with ratees. C. high-performing workers. D. low-performing workers.
C
_____ theory states that success-sharing plans will be motivating, whereas at-risk plans will be demotivating. A. Equit y B. Expectancy and agency C. Herzberg's two- factor D. Agenc y
C
Which of the following does NOT provide for incentives based on standards that are expressed in terms of time period per unit of production? A. Gantt plan B. Rowan plan C. Halsey 50-50 method D. Merrick system
D
Gain sharing poses greater risk to individual employees than profit sharing.
F
Gain-sharing plans do not to use a historical standard to set productivity standards since environmental conditions can change quickly.
F
If the future cost containment of a benefit may be a problem, the benefit should be offered on a noncontributory basis.
F
MBO is particularly well suited as a basis for administrative decisions such as pay raises.
F
Which of the following is NOT true of merit bonuses? A. They are viewed as less of an entitlement than merit pay. B. They are more expensive than merit pay in the long run. C. Employees dislike them. D. They are thought to be a substitute for merit pay.
B
There is evidence that every 10 percent increase in the bonus paid to employees by a firm yields a _____ percent increase in ROA to the firm. A. 1 B. 1.5 C. 5 D. 15
B
The biggest cost-containment strategy in recent years is the movement to: A. benefit limitations. B. HMOs . C. outsourcin g. D. higher deductibles.
C
Which of the following is an advantage of providing stock ownership options as variable pay to employees? A. It reinforces team identity. B. It is the simplest type of variable-pay plan. C. It defers a portion of taxes to employees. D. It provides a direct pay-performance link.
C
_____ is the most frequently used medium for communicating employee benefits. A. A notice board B. A seminar C. An employee benefit handbook D. A meeting with the chief executive officer
C
_____ theory argues that performance-based pay is the optimal compensation choice for complex jobs, where monitoring employee performance is difficult. A. Reinforcement B. Goal-Setting C. Agency D. Expectancy
C
An incentive system with three piecework rates is the _____ plan. A. Taylor B. Gantt C. Halsey 50-50 D. Merrick
D
The performance of hourly workers is more accurately tied to quantifiable measures than the performance of managerial workers.
F
Surveys show that the most highly valued benefit is: A. dental coverage. B. life insurance. C. paid vacation and holidays. D. medical insurance.
D
One common feature of all types of incentive plans is: A. an established standard of performance that is used to determine the magnitude of the incentive pay. B. a sharing contract between the employees and employers, which stipulates that the losses incurred by the companies will be shared by both employees and employers. C. the established formula that specifies the maximum percentage of base pay allocated as incentives. D. a risk-sharing plan that increases pay depending upon the turnover rate of a company.
A
The ability triangle includes _____. A. selection B. performance management C. compensation D. organization development
A
The most widely used benefit survey is conducted by: A. the U.S. Chamber of Commerce. B. Watson- Wyatt. C. the Society for Human Resource Management. D. the American Compensation Association.
A
When a company moves from an individual incentive plan to a group incentive plan, the company is most likely to experience _____. 9-23 Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. A. higher turnover among high performers B. an increase in instrumentality C. higher turnover among poor performers D. an increase in perceived equity
A
All of the following are advantages of flexible benefits EXCEPT: A. containment of costs of benefits. B. increased understanding of benefits by employees. C. reduced expense of introducing new benefits. D. decreased administrative expenses.
D
All of the following support the use of individual incentives EXCEPT: A. the independent nature of task accomplishment. B. the high commitment levels of workers to their profession. C. the readily apparent performance standards. D. the presence of a union.
D
Maxwell Construction Corp. employs a lot of uneducated laborers. The company wants to introduce a variable-pay plan that is easy to understand and does not cost much to administer. Which of the following variable-pay plans is Maxwell most likely to introduce? A. Balanced scorecard plan B. Gain-sharing plan C. Stock ownership plan D. Cash profit sharing plan
D
Cost pressure related to increasing diversity of the workforce is one of the reasons companies are offering flexible benefit plans.
T
During performance appraisals, managers tend to focus on either good performance, counterproductive performance, or both.
T
Employees prefer using their company's intranet for accessing their benefits information as they do not need to complete lengthy paperwork.
T
Employees who are dissatisfied with performance appraisals are less satisfied with their pay.
T
Flexible benefit plans eliminate the involvement of employees.
F
Employees' preferences of various benefits can be predicted accurately from demographic data.
F
Employers prefer the noncontributory approach to financing benefits because this allows greater control of costs.
F
Goal-setting theory argues that employees' performance is maximized when performance targets are unchallenging and unspecific.
F
In the formula "Behavior = f (M, A, E)," denotes monetary incentives.
F
The Employment Retirement Income Security Act (1974) requires employers to offer some form of pension.
F
The Family Medical Leave Act of 1993 mandates 20 weeks of leave for all workers at companies that employ 10 or more people.
F
Unions prefer individual incentive pay plans to group incentive pay plans since members can earn more money.
F
Employees working under individual incentive plans tend to resist the introduction of new technology.
T
Evidence suggests that skill-based pay may not increase productivity.
T
High performance ratings are nearly always statistically related to high merit increases.
T
In most Asian cultures, employees do not welcome performance feedback.
T
Supervisors tend to weigh negative attributes more heavily than positive attributes.
T
The central issue involving merit pay is how to get employees to view raises as a reward for performance.
T
The only two benefits shown to reduce turnover are pensions and medical coverage.
T
One of the most preferred benefits is _____. A. stock plans B. profit sharing C. shorter working hours D. early retirement
A
Subordinate ratings _____. A. are likely to be inflated if they are not anonymous B. are immune to halo errors C. are immune to horn errors D. are used by 70 percent of all team-style organizations
A
Which of the following is a disadvantage of gain-sharing plans? A. Payouts can occur even if a company's financial performance is poor. B. Pay-performance link is indirect. C. Employees are required to put up money to exercise grants. D. Mandatory stock ownership required by gain-sharing plans can increase turnover rates.
A
Which of the following is an example of the sorting effect in action? A. An employee leaving a high-paying job for one that provides more work/life balance B. The provision of across-the-board pay increases by a company C. The provision of cost-of-living increases by a company D. An employee choosing fewer incentives in his flexible compensation plan
A
Which of the following is the best appraisal format in terms of legal defensibility? A. BARS B. MBO C. Essay format D. Ranking method
A
Which of the following companies uses probationary periods as a cost-containment measure? A. Alpha Corp. combines the benefits offered for couples who work within the organization B. DLG Corp. excludes its new recruits from benefit coverage until they complete a year C. Kimberly Corp. requires employees in the lowest salary quartile to pay for 20 percent of benefits D. Amethyst Corp. limits its employees to avail coverage for only two dentist visits every six months
B
Which of the following cost-containment strategies is used by GrindStop? A. Copay B. Benefit limitation C. Administrative cost containment D. Wellness program
B
Most experts agree that employees do not begin to consider changing their behaviors unless payouts are at least _____ percent higher. A. 5 B. 8 C. 20 D. 10
C
Paying a dime for every bottle collected and turned into a collection center is an example of a: A. standard hour plan. B. Merrick system. C. straight piecework system. D. Rowan plan.
C
_____ is the value employees attach to the organization rewards offered for satisfactory job performance. A. Equit y B. Instrumentalit y C. Valenc e D. Reinforceme nt
C
Which of the following is an advantage of flexible benefit plans? A. They require no expenditure from the employers. B. They decrease the administrative burdens for employers. C. They decrease the costs as employees pick only those benefits they will use resulting in the subsequent high benefit utilization. D. They increase the involvement of employees in choosing benefit plans.
D
Which of the following is an advantage of gain-sharing plans? A. They are the simplest type of variable-pay plan. B. They allow payouts to occur even if a company's financial performance is poor. C. They are administratively easy to implement. D. They increase employees' knowledge of business.
D
_____ allows employees who have resigned or have been laid off through no fault of their own to continue receiving health coverage under their employer's plan at a cost borne by the employee. A. Health Maintenance Act (1973) B. FLSA (1938) C. The tax reform of 1982 D. COBRA (1984)
D
The Rowan plan uses a standard that is purposefully set high requiring high performance levels.
F
The behaviorally anchored rating scales are inexpensive to develop but time-consuming to use.
F
The favorable tax status granted to many benefits is safe from the threat of recurrent tax reform proposals.
F
The free-rider problem is common in firms using individual incentive plans.
F
The percentage of companies using some form of variable pay is declining because many employees prefer base wages.
F
Today, benefits make up about 25 percent of payroll costs.
F
The authors argue that a system of flexible compensation could lead to more desirable employee behaviors at a lower total cost.
T
All of the following factors are reasons for the growth of benefits EXCEPT: A. foreign lawsuits. B. union s. C. cost effectiveness of benefits. D. government impetus.
A
A major criticism of standard rating scales is that: A. raters have different definitions of scale levels. B. raters find them hard to use. C. they are expensive to develop. D. they encourage halo and horns errors.
A
A survey shows that the majority of employers are responding to increased benefit costs by _____. A. requiring employees to pay higher deductibles and copays B. laying off employees C. dropping health care plans D. relying on the Patient Protection and Affordable Care Act
A
According to research, which of the following is NOT one of the most important factors for employees influencing their pay systems? A. Team-based pay B. Changes in cost of living C. Pay at market rate D. Seniority
A
According to the _____ theory, relative pay is important as employees evaluate their pay-effort balance in comparison to other employees. A. equity B. expectancy C. agency D. reinforcement
A
Deming's major argument regarding performance appraisals is that: A. the work situation is the major determinant of performance. B. performance appraisals reduce teamwork. C. peer ratings are better than supervisor ratings. D. lack of training makes performance appraisals redundant.
A
Grabhouse Inc. is experiencing an increase in turnover rates of its top employees. Upon consulting with its managers for the reasons for this increase, Grabhouse finds that employees are uneasy with the current pay mix as it involves too many risky elements. In order to make its pay mix less risky, Grabhouse needs to: A. increase the base pay component of its pay mix. B. introduce a profit-sharing plan to its pay mix. C. introduce a risk-sharing plan to its pay mix. D. increase the merit bonus component of its pay mix.
A
Teaching raters what constitutes good, average, and poor performance is _____ training. A. performance- standard B. rater- error C. performance- dimension D. Six- Sigma
A
Trumbrella Corp. is a pharmaceuticals company. One of its employees reports that he had an on-the-job injury caused by slippery factory floor that broke his back. When Trumbrella initiates its claims processing, it should first: A. determine whether the accident happened. B. determine if the employee is eligible for any benefit. C. calculate the payment required to be paid to the employee. D. contact the insurance companies to enquire about the possibility of a joint payment.
A
When pay is based on individual performance, turnover tends to be highest among _____. A. poor performers B. good performers C. single women with children D. ethnic minorities
A
TreeDen Corp. experiences an increase in employee turnover rate. Upon investigating, it discovers that employees are dissatisfied with the company's pay. Employees cannot see a direct link between their performance and their pay. They are also unhappy about having to pay out of their pockets to obtain grants. In this case, TreeDen is most likely using a _____. A. stock ownership plan B. cash profit sharing plan C. gain-sharing plan D. team incentive plan
A
When an organization's performance has regular and large swings and individual performance is unclear and hard to measure, the most effective compensation mix is to offer _____. A. a base pay with low incentives and a variety of rewards B. monetary rewards with large incentives C. a large base pay and low-incentive pay D. a wide range of rewards and significant incentives
A
Which of the following is NOT true regarding performance appraisals? A. Race has no effect in layoff decisions. B. Males are rated higher than females. C. Raters with traditional stereotypes rate females less accurately. D. Variation in performance affects ratings.
A
A recent survey shows employees ranking employee benefits _____ in explaining job satisfaction. A. first B. second C. third D. last
B
A team leader with a free-rider problem in his team can most likely maximize the performance of his team by: A. instructing them to do their best. B. specifying performance levels and due dates. C. assigning tasks only to the top performers in the team. D. punishing free riders who fail to meet standards.
B
Droppiece Inc. is a company that provides more performance-based pay and less base pay than its competitors. Who among the following is most likely to join Droppiece? A. George, a recently married man who wants a stable income B. Stella, a recent college graduate who loves to take on a challenge C. Mark, a musician who wants to supplement his income D. Sara, a senior citizen who wants a job only to keep herself busy
B
For any task completed in standard time or less, earnings are pegged at 120 percent of the time saved under the _____ plan. A. Halsey 50-50 B. Gantt C. Taylor D. Rowan
B
If you had repair work done on your car, the shop most likely used the _____ plan to pay the mechanic. A. Bedeaux B. standard hour C. Halsey 50-50 D. straight piecework
B
In situations where the nature of the task is so uncertain that it may be difficult to specify expected goals, the most appropriate rating format is _____. A. an MBO format B. a standard rating scale C. a behaviorally anchored rating scale D. an essay format
B
The best appraisal format for employee development is: A. the BARS format. B. the MBO format. C. the essay format. D. the ranking format.
B
Which of the following is NOT true about individual spot awards? A. Smaller companies may be more casual about recognition for spot awards. B. Someone in an organization alerts top management about performances deserving of an award. C. A majority of companies do not feel that these awards are effective. D. Smaller companies are more subjective about deciding the size of the award.
C
Which of the following is a negative outcome of the management by objectives method? A. Increased difficulty of the planning process B. Decrease in superior/subordinate communication C. Increase in performance pressure and stress D. Lack of direction for work units
C
Which of the following statements is NOT true? A. Workers who start out high in performance and then get worse are rated lower than workers who remain consistently low. B. Workers whose performance improves over time are seen as more motivated. C. Workers whose performance is consistently average are rated higher than those who perform better at the end of a rating cycle. D. Workers whose performance varies over time are seen as less motivated.
C
_____ is an individual level form of performance pay. A. Risk sharing B. Gain sharing C. Merit bonus D. Success sharing
C
_____ is employees' beliefs that requisite job performance will be rewarded by the organization. A. Valenc e B. Expectan cy C. Instrumentalit y D. Utility
C
In gain-sharing plan formulas, _____ are in the numerator and _____ are in the denominator. A. productivity measures; inputs 10-24 Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. B. productivity measures; labor inputs C. costs; revenues D. labor inputs; productivity outcomes
D
Last year your performance was not very good and your performance rating was below average, but this year you have done very well by exceeding your performance goals. To your surprise, your boss gives you just an average performance rating. What error has your boss most likely committed? A. Horn error B. Halo error C. Severity error D. Spillover error
D
Which of the following is NOT part of the cost-centered approach for deciding to provide a benefit? A. Checking compliance B. Evaluating competitiveness of current benefits C. Examining employee preferences D. Basing benefits on historical costs
D
A major reason for the proliferating cost of benefit programs is the narrow focus of benefit administrators.
T
A combination plan often favored by CEOs who don't like to make payouts when the company loses money is a completely self-funding plan.
T
A disadvantage of flexible benefit programs is that they increase administrative burdens.
T
A fast and efficient worker would earn more money under a Rowan plan than under a Halsey 50-50.
T
A group performance-based pay plan is superior to an individual plan when production methods and labor mix must change to meet changing pressures.
T
The trend today is toward less stable and less secure compensation packages.
T
Jake's new car was dented by his employee, Steve. Ever since then, Jake has been consistently giving lower ratings to Steve during performance reviews to get back at him. Which of the following errors has been exhibited by Jake? A. Halo error B. Severity error C. Leniency error D. Clone error
B
Menthorp Inc. wants to design a variable-pay plan that fosters teamwork and business knowledge of its employees. In order to ensure maximum motivation, Menthorp wants its variable-pay plan to show a clear performance-reward link. Which of the following plans is most suitable for Menthorp? A. Gain-sharing plan B. Cash profit sharing plan C. Stock ownership plan D. Stock options plan
B
Telling raters that sometimes the work environment and system affect job performance more than the individual employee's behavior: A. makes the ratings completely accurate. B. leads to higher ratings. C. has no effect on the ratings. D. leads to lower ratings.
B
The most common form of outcomes-based appraisal is: A. the essay method. B. MBO . C. the performance standards review. D. the BARS.
B
The most obvious sorting factor is _____. A. seniority B. ability C. experience D. educational qualification
B
The trend in recent variable-pay design is to combine the best of _____ and _____ plans. A. individual; group B. gain-sharing; profit- sharing C. Halsey 50-50; Rowan D. balanced scorecard; cash profit sharing
B
The typical employee can recall _____ percent of the benefits he or she receives. A. almost 50 B. less than 15 C. over 30 D. 4 0
B
A horn error occurs when an employee is: A. consistently rated higher than deserved. B. given a favorable rating on all job duties based on his or her impressive performance in just one job function. C. downgraded across all performance dimensions because of poor performance on one dimension. D. consistently rated lower than deserved.
C
DrenchFort Corp. is a small company that pays high wages. As its wages are high, it does not provide any benefits. Recently, it has noticed that its employee turnover has increased, so it decides to provide benefits to retain employees. Which of the following benefits is most likely to reduce turnover? A. Counseling service B. Early retirement plan C. Medical coverage D. Profit-sharing plan
C
In _____ ranking, raters look at a list of employees, decide who the best employee is, and cross that person's name off the list. From the remaining names, the manager decides who the worst employee is and crosses that name off the list—and so forth. A. paired- comparison B. straig ht C. alternatio n D. forced distribution
C
When an organization's performance has frequent highs and lows, but individual performance is fairly stable, and performance measures are clear, the most effective compensation mix is to offer _____. A. a base pay with low incentives and a variety of rewards B. monetary rewards with large incentives C. a large base pay and low-incentive pay D. a wide range of rewards and significant incentives
C
When employee performance measures are ambiguous and vary from time to time, but the organization's performance is fairly stable over time, the most effective type of compensation is to offer _____. A. a large base pay and low-incentive pay B. an increase in base pay C. a variety of rewards with significant incentive pay D. monetary rewards with no benefits
C
When identifying what is important to employees, which theory would be most useful? A. Expectancy theory B. Equity theory C. Maslow's need theory D. Agency theory
C
Which of the following is NOT an advantage of team incentives? A. Stimulates problem solving B. May better reflect how work is performed C. Easy to set equitable targets for all teams D. Minimizes distinctions between team
C
_____ is the best appraisal format across the five criteria for evaluating rating formats. A. Rankin g B. MBO C. BAR S D. Standard rating scales
C
A job ad stating generous benefits leads applicants to place higher value on benefits in choosing among jobs.
T
A major problem in group incentive plans is that performance targets are not correctly set.
T
A problem with incentive pay plans is workers may end up focusing exclusively on behaviors that are rewarded.
T
Herzberg's two-factor theory argues success-sharing plans will be motivating, while at-risk plans will be demotivating.
T
Halo error is the error that occurs when an employee is downgraded across all performance dimensions exclusively because of poor performance in one dimension.
F
The first issue in setting up a benefits package is: A. finding out who should be protected or benefited. B. figuring out how much choice should employees have among benefits. C. determining how benefits should be financed. D. choosing legally defensible benefits.
A
Which of the following is statements is true of leniency errors? A. It is the error of consistently rating someone higher than is deserved. B. It is the error of avoiding extremes in ratings across employees. C. It is the error of downgrading an employee across all performance dimensions exclusively because of poor performance on one dimension. D. It is the error of giving better ratings to individuals who are like the rater in behavior and personality.
A
Central tendency errors are the most difficult form of error to eliminate.
F
The motivation triangle includes _____. A. selection B. organization design C. culture D. organization development
C
Which of the following is NOT a disadvantage of flexible benefit programs? A. Administrative burdens and expenses increase. B. Adverse selection of benefits by employees results in increase in costs. C. New benefits are more difficult to introduce. D. Flexible benefits are subject to nondiscrimination requirements in Section 125 of Internal Revenue Code.
C
Which of the following is NOT a long-term incentive plan? A. ESOP s B. Broad-based option plans (BBOPs) C. Improshar es D. Performance plans
C
Which of the following rating formats has the lowest rating errors? A. Standard rating scales B. BARS C. MBO D. Ranking
C
Components identified as vital to the success of both Scanlon and Rucker plans are: A. top management support and primary focus on wage incentives. B. a flexible pay out formula and low turnover rates. C. union and top management support. D. a productivity norm and effective worker committees.
D
During the performance review of her employees, Sarah gives higher ratings to employees from her hometown, Oklahoma, as she believes that people from Oklahoma are hard working and trustworthy. Which of the following rating errors is Sarah exhibiting? A. Severity error B. Horn error C. Spillover error D. Clone error
D
The amount of fairness given to employees refers to _____. A. total justice B. quantitative justice C. procedural justice D. distributive justice
D
The corporate performance of Yellow Corp. is fairly stable. However, it is difficult to measure individual performance. In this case, the most effective compensation mix is to offer _____. A. a high base pay with high incentives B. monetary rewards alone C. a large base pay and low-incentive pay D. a wide range of awards beyond just money
D
Various studies have found that only two specific benefits curtailed employee turnover: _____ and _____. A. vacation days; dental plans B. profit-sharing plans; life insurance C. retirement benefits; paid vacations D. pensions; medical coverage
D
When employee performance is easily measured and the organization's performance is fairly stable over time, the most effective type of compensation is to offer _____. A. a large base pay and low-incentive pay B. a variety of rewards in addition to base pay C. a variety of rewards with significant incentive pay D. monetary rewards with large incentives
D
Which of the following is NOT true regarding self-ratings? A. They are done by someone who has the most complete knowledge about the rate's performance. B. They are best used for development. C. They are often used as the first step in the appraisal process. D. They are immune to leniency errors.
D
Which of the following is NOT true? A. More companies are using pay systems based upon individual, group, and organization performance. B. Workers with high security needs may accept lower pay if they come in a package that is stable. C. Workers may need higher pay to stay and perform in a company that uses at-risk pay plan. D. Companies are moving back to entitlement-oriented pay to reduce turnover.
D
Flexible compensation is based on the idea that the organization knows what package of rewards would best suit an individual employee's needs.
F
Which of the following statements is true regarding rater training? A. Training programs lasting over two hours are less successful than shorter ones. B. Rater-error training is more effective than performance-standard or performance- dimension training. C. Lectures to raters on how to improve ratings are always ineffective. D. Training to reduce halo errors and improve accuracy has been most successful.
D
In contrast to ranking formats, rating formats require raters to evaluate employees on some absolute standard rather than relative to other employees.
T
Individual incentives yield higher productivity gains than group incentives.
T
Keeping a performance diary can help employers defend against discrimination charges stemming from performance ratings.
T
MBO requires more paperwork than other rating methods and increases both performance pressure and stress.
T
Many variable-pay plans have some form of profit trigger linked to revenue growth or profit margins.
T
Maslow's theory suggests that performance-based pay can be demotivating if it impinges upon employees' capacity to meet daily living needs.
T
Merit pay is a pay-for-performance plan used for more than three-quarters of all exempt, clerical, and administrative employees.
T
No strong data exist linking benefits level and employee productivity.
T
