Incentive plans imply:
A) if managers get highly paid, then they work hard.
B) if managers put forth little effort, they receive little pay; if they put forth much effort and hence generate many sales, they receive a lot of pay.
C) managers are not selfish.
D) managers should be watched all the time.

Question

Quizplus · Accepted Answer

Incentive plans are designed to motivate employees, including managers, to put forth effort by linking their pay to their performance. This means that if they generate more sales or achieve particular goals, they will receive more pay, and if they put forth less effort, they will receive less pay. This system is designed to incentivize hard work and productivity rather than relying solely on a high base salary. Therefore, choice B is the best answer. Option A oversimplifies the relationship between pay and effort, while option C is not necessarily true or relevant to the discussion. Option D suggests a more negative view of management, which is not necessary to understanding incentive plans.

Incentive Plans Imply