Which type of compensation is most prevalent when a satisfactory performance measure cannot be designed?
A)dividends
B)stock options
C)salary
D)bonus based on ROI
E)bonus based on ROI and/or RI

Question

Quizplus · Accepted Answer

When a satisfactory performance measure cannot be designed, the most prevalent type of compensation is salary. This is because salary is a fixed amount of money that is paid to an employee for their work, regardless of their level of productivity or performance. While this may not be the most effective form of compensation to incentivize top performance, it ensures that employees receive a consistent and reliable source of income. The other options, such as dividends, stock options, and bonuses based on ROI or RI, are typically tied to specific measures of performance and may not be appropriate when those measures are unavailable.

Which Type of Compensation Is Most Prevalent When a Satisfactory