Deck 1: The Pay Model

Question 1

Which of the following includes restrictions on executive pay that are designed to discourage executives from taking "unnecessary and excessive risks"?

A) Corporate Welfare Program
B) Employee Welfare Program
C) Troubled Asset Relief Program
D) Corporate Liability Relief Program

Answer 1

C

Question 2

All of the following have direct financial costs for an employer except:

A) benefits
B) relational returns
C) work-life balance
D) income protection

Answer 2

B

Question 3

Variable pay may also be called

A) exempt
B) non-exempt
C) stock options
D) incentives

Answer 3

D

Question 4

The degree to which pay influences individual and aggregate motivation among the employees at any point in time is referred to as:

A) sorting effect.
B) incentive effect.
C) motivational effect.
D) directional effect.

Question 5

_____ would be most concerned about compensation as a major expense.

A) Managers
B) Employees
C) Society
D) Stockholders

Question 6

_____ would be most concerned about executive pay.

A) Managers
B) Employees
C) Society
D) Stockholders

Question 7

Which of the following is an example of a relational return?

A) Short-term incentives
B) Recognition and status
C) Work-life balance
D) Income protection

Question 8

In China,compensation,dai yu,has come to mean

A) entitlement and benefits.
B) cash compensation.
C) returns and entitlement.
D) cash compensation and relational returns.

Question 9

A company that says its relatively low starting pay will be offset by larger future pay increases is using the concept of _____.

A) present-value
B) merit pay
C) incentives
D) deferred benefits

Question 10

Hourly compensation costs for manufacturing workers are lower in _____ than the U.S.

A) Korea
B) Norway
C) Sweden
D) Netherlands

Question 11

In Japanese companies,the concept of teate is consistent with which of the following?

A) Sophisticated performance appraisal systems
B) A strong emphasis on performance pay
C) Family,housing and commuting allowances
D) Rapid promotions

Question 12

The primary reason compensation is important to managers is because:

A) employees regard it as a reward.
B) it influences employee behavior.
C) it is a larger cost than benefits.
D) stock holders dislike high compensation costs.

Question 13

When executives decide where to locate a manufacturing plant,the most important consideration is:

A) hourly compensation costs
B) labor productivity
C) strength of local labor unions
D) cost of government mandated benefits

Question 14

Which of the following are given as increments to the base pay in recognition of past work behavior?

A) Base pay
B) Cost-of-living adjustments
C) Merit pay
D) Incentives

Question 15

Hourly compensation costs for manufacturing workers are higher in _____ than the U.S.

A) Norway
B) Japan
C) Spain
D) Singapore

Question 16

According to the text,if women had the same education,experience,and union coverage as men and also worked in the same industries and occupations,they would be expected to earn about _____ of what men earn.

A) 62%
B) 70%
C) 80%
D) 90%

Question 17

Employees who want to be sure their good performance will be rewarded will prefer

A) merit pay.
B) team incentives.
C) individual incentives.
D) across-the-board pay increases.

Question 18

Which of the following is the largest component in an executive pay package?

A) Base pay
B) Stock options
C) Merit pay
D) Perks

Question 19

Employees view compensation as all but which of the following?

A) A return
B) An entitlement
C) A reward
D) An investment

Question 20

Which form of pay is likely to be least expensive for employers?

A) Incentive
B) Merit pay
C) Cost-of-living adjustments
D) Base pay

Question 21

Which of the following is not an objective in the pay model?

A) Fairness
B) Compliance
C) Efficiency
D) Productivity

Question 22

Which of the following is not a policy in the pay model?

A) Fairness
B) Competitiveness
C) Contributions
D) Alignment

Question 23

A measure of how changes in one variable are related to changes in another variable is:

A) standard deviation
B) analysis of variance
C) correlation coefficient
D) regression analysis

Question 24

Which of the following is not a guideline for determining if research has value?

A) Is the research useful
B) Can alternative explanations be ruled out
C) Was the research conducted by Ph D researchers
D) Is correlation separated from causation

Question 25

Which of the following decisions answers the "So What" question?

A) Internal alignment
B) Employee contributions
C) External competitiveness
D) Management

Question 26

The best way to establish _____ is to account for competing explanations,either statistically or through control groups.

A) causation
B) profitability
C) correlation coefficient
D) internal alignment

Question 27

Market definitions are to competitiveness as performance based is to _____.

A) alignment
B) compliance
C) efficiency
D) contributions

Question 28

Managers seek internal alignment within their organization by:

A) matching competitors' pay rates.
B) following FLSA guidelines.
C) using fair merit increases.
D) paying on the basis of similarities among jobs.

Question 29

_____ refers to comparisons among jobs or skills inside a single organization.

A) External competitiveness
B) Internal alignment
C) Pay structure
D) Equitable contributions

Question 30

Which of the following decisions directly affects employees' attitudes and work behaviors?

A) Employee contributions
B) Internal alignment
C) External competitiveness
D) Management

Question 31

Performance,quality,customers,stockholders and costs are components of which of the objectives of the pay model?

A) Fairness
B) Compliance
C) Efficiency
D) Competitiveness

Question 32

Choices among pay for performance,flat rate pay and profit sharing are examples of _____ policy decisions.

A) internal alignment
B) efficiency
C) employee contributions
D) management

Question 33

Which of the following policy choices has the greatest effect on employees' decisions to stay with the organization and to seek additional training and responsibilities?

A) External competitiveness
B) Employee contributions
C) Internal alignment
D) Job evaluation

Question 34

You are an HR manager and your boss has told you to find the best way to raise job performance.After some research you find that _____ produce(s)the largest and most reliable performance increases.

A) high base pay
B) great benefits that attract and retain workers
C) a combination of goal setting and job enrichment
D) monetary incentives

Question 35

Compensation policy choices affecting pay level are most closely associated with _____.

A) internal alignment
B) external competitiveness
C) contributions
D) management

Question 36

If an organization allows workers to get rewards such as stock options due to illegal and unethical means,this reflects a failure of which policy choice?

A) Internal alignment
B) Efficiency
C) Employee contributions
D) Management

Question 37

Costs are to management as _____ is to alignment.

A) work analysis
B) communication
C) surveys
D) merit guidelines

Question 38

Sam's Club matches the pay of other similar businesses,Whole Foods uses base pay and team incentives and Medtronic emphasizes work and life balance.These illustrate _____ pay policy choices.

A) cost control
B) internal alignment
C) contributions
D) external competitiveness

Question 39

According to the text,which of the following decisions should be made jointly?

A) Internal alignment and Management.
B) External competitiveness and Employee contribution
C) Employee contribution and Internal alignment
D) Management and External competitiveness

Question 40

_____ implies that the way a pay decision is made may be as important to employees as the results of that decision.

A) Fairness
B) Compliance
C) Efficiency
D) Competitiveness

Question 41

If you often had to work 50 or more hours per week at an assembly job,you would probably prefer to that your job is classified as exempt under the FLSA.

Question 42

The objective of compliance suggests the way a pay decision is made may be as important to employees as the results of that decision.

Question 43

Most U.S.firms use merit pay increases.

Question 44

If an objective is to increase customer satisfaction,then incentive programs and merit pay might be used to pay for performance.

Question 45

Compensation is important to managers' success because it is a major cost and it influences employee behavior.

Question 46

The U.S.has the highest hourly compensation costs for manufacturing workers of any industrialized nation.

Question 47

The objective of procedural fairness suggests the way a pay decision is made may be as important to employees as the results of that decision.

Question 48

The policy choice of management means ensuring that the right people get the right pay for achieving the right objectives in the right way.

Question 49

External competitiveness decisions focus on both pay levels.

Question 50

Employees classified as non-exempt under FLSA are paid a salary,not wages.

Question 51

Management of the pay system focuses on cost control and employee perceptions of fairness since they are most important to management.

Question 52

Base wage reflects both the value of the work and individual employee skills and experience.

Question 53

Contributions refers to employees' perceptions of the fairness of pay differences among different jobs within their organization.

Question 54

Internal alignment refers to comparisons among jobs or skill levels inside a single organization.

Question 55

A bonus promised by your boss if costs are below your budget is a merit increase.

Question 56

The most important of the pay model policies for assuring fairness is contributions.

Question 57

A major challenge facing most employers is the rising cost of health care benefits.

Question 58

Since the U.S.has the highest hourly compensation costs for manufacturing workers of any industrialized nation,executives could minimize total labor costs by producing in low cost countries such as China and Mexico.

Question 59

Challenging work and employment security are examples of total compensation.

Question 60

In practice,there is no real difference between merit pay increases and cost-of-living adjustments.

Question 61

The R² is different form correlation in that it tells us what percentage of the variation is accounted for by the variables we are using to predict or explain.

Question 62

Describe the various returns received from work.

Question 63

Describe stockholders perspective on compensation.

Question 64

Management and HR research has conclusively shown that goal setting and job enrichment produce the largest and most reliable increases in job performance.

Question 65

List the basic elements of the pay model.

Question 66

Causality is one of the most difficult questions to answer and continues to be an important and sometimes perplexing problem for researchers.

Question 67

In judging the value of research,an important guideline is that the research was conducted by Ph D researchers.

Question 68

What are the different ways in which employees see compensation?

Question 69

An important criteria for determining the value of research is/are there alternative explanations for the research findings?

Question 70

Compensations differ with perspective.What are the different perspectives of compensation described in the text?

Question 71

Monetary incentives produce the biggest increases in job performance.

Question 72

Write short notes on the different types of cash compensations discussed in the text.

Question 73

List and define the different policy decisions of the pay model.

Question 74

A study found that there is only a very small amount of change in CEO pay is related to changes in company performance.

Question 75

What are the different ways in which pay can influence employee motivation and behavior?

Question 76

An important criteria for determining the value of research is whether the research is useful.

Question 77

A study of IBM showed that their long-standing policy of no layoffs was the major cause of their strong profits.

Question 78

Explain the compensation objectives of the pay model.

Question 79

Since HR research contains information useful to managers,most managers read research in HR,management and compensation journals.

Question 80

Write short notes on the different types of benefits discussed in the text.