Jack and Jerry are twins.Both started working at competing firms in the same industry.Jack and Jerry were given exactly the same starting salary.They have been with their companies for ten years,and both have identical positions and identical performance ratings.Both Jack and Jerry are consistently average performers.Jack works at a company with an entitlement compensation philosophy.Jerry works at a company with a pay-for-performance compensation philosophy.The two companies are identical in revenue and profitability.They allocate the same budget amount for employee raises each year.All other factors remaining equal,which of the following statements is most likely to be true?
A) Jerry will have a higher salary than Jack.
B) Jack will have a higher salary than Jerry.
C) Jerry and Jack will have identical salaries.
D) Jerry and Jack will have identical levels of pay satisfaction.

Question

Quizplus · Accepted Answer

Jack is likely to have a higher salary because an entitlement compensation philosophy typically results in regular salary increases based on tenure, regardless of performance.

Jack and Jerry Are Twins