Question 1

Discuss the use of compensation and incentives in recruiting employees for small businesses.

Accepted Answer

Except in very unusual situations, small firms must be roughly competitive with larger firms in financial remuneration. If the small firm pays substantially less than competitors, it will have difficulty obtaining comparable talent. To some extent, of course, weaknesses in the area of salaries might be offset by strengths in other areas (e.g., commission systems, bonus and profit sharing plans, fringe benefits, and employee stock ownership plans.) However, employers are viewed as attractive to potential applicants only to the degree that they can offer competitive rates.
In the area of nonfinancial incentives, small firms have the potential for superiority. They can offer applicants an escape from bureaucracy and red tape. They may offer applicants the opportunity to perform challenging work, as well as the opportunity to obtain diversified experience quickly. These are meaningful incentives if the firm is strong and growing and knows where it is going.

Question 2

Karl Milgram is concerned that many employees who successfully passed their employment test later perform poorly on the job. He believes the employment test lacks

Accepted Answer

A)  applicability. 
B)  interpretability. 
C)  reliability. 
D)  validity. 
A)  applicability. 
B)  interpretability. 
C)  reliability. 
D)  validity. D

Question 3

Profit sharing provides a more direct work incentive in small firms than it does in large firms.

Accepted Answer

A) True 
 B)False  True

Question 4

Secondary and trade schools are a likely source of

Accepted Answer

A)  managers. 
B)  personnel to fill positions requiring no specific work experiences. 
C)  accountants. 
D)  high-potential employees. 
A)  managers. 
B)  personnel to fill positions requiring no specific work experiences. 
C)  accountants. 
D)  high-potential employees.

Question 5

One of the largest expense categories for most businesses is

Accepted Answer

A)  advertising 
B)  research and development 
C)  payroll 
D)  professional fees 
A)  advertising 
B)  research and development 
C)  payroll 
D)  professional fees

Question 6

A small business owner wishes to persuade a highly qualified applicant (a business school graduate) to consider a position with his firm carefully, even though the applicant has also had offers from large corporations. The owner should most strongly emphasize the

Accepted Answer

A)  family atmosphere. 
B)  retirement program. 
C)  potential for greater freedom of personnel to structure their job duties. 
D)  long history of the firm. 
A)  family atmosphere. 
B)  retirement program. 
C)  potential for greater freedom of personnel to structure their job duties. 
D)  long history of the firm.

Question 7

In seeking personnel for non-critical positions, small firms sometimes turn to

Accepted Answer

A)  temporary help agencies. 
B)  leasing companies. 
C)  attorneys. 
D)  headhunters. 
A)  temporary help agencies. 
B)  leasing companies. 
C)  attorneys. 
D)  headhunters.

Question 8

The Americans with Disabilities Act requires employers to make _____ adaptations to facilitate the employment of individuals protected by the act.

Accepted Answer

A)  specific 
B)  minimal 
C)  reasonable 
D)  verifiable 
A)  specific 
B)  minimal 
C)  reasonable 
D)  verifiable

Question 9

Fringe benefits are expensive, amounting to more than 40 percent of payroll expense for many small firms.

Accepted Answer

A) True 
 B)False

Question 10

Management and other key personnel "get a piece of the action" through

Accepted Answer

A)  fringe benefits. 
B)  time-based compensation. 
C)  profit sharing. 
D)  tax benefits. 
A)  fringe benefits. 
B)  time-based compensation. 
C)  profit sharing. 
D)  tax benefits.

Question 11

As part of preparing a business plan, Grace Wang wishes to show the cost of fringe benefits as a percentage of payroll costs. She should use the following percentage:

Accepted Answer

A)  40 percent. 
B)  25 percent. 
C)  15 percent. 
D)  5 percent. 
A)  40 percent. 
B)  25 percent. 
C)  15 percent. 
D)  5 percent.

Question 12

As a firm grows, it experiences pressure to formalize its personnel policies and procedures.

Accepted Answer

A) True 
 B)False

Question 13

James Sandberg is investigating the advantages of employee leasing. It appears that the greatest benefit will be to free him and his firm from

Accepted Answer

A)  the need for extensive training. 
B)  fringe benefit costs. 
C)  concern about disciplinary action. 
D)  excessive paperwork. 
A)  the need for extensive training. 
B)  fringe benefit costs. 
C)  concern about disciplinary action. 
D)  excessive paperwork.

Question 14

You Make the Call-Situation 2
Technical Products, Inc., distributes 15 percent of its profits quarterly to its eight employees. This money is invested for their benefit in a retirement plan and is fully vested after five years. An employee, therefore, has a claim to the retirement fund even if he or she leaves the company after five years of service. The employees range in age from 25 to 59 and have worked for the company from 3 to 27 years. They seem to have recognized the value of the program. However, younger employees sometimes express a preference for cash over retirement benefits.

Accepted Answer

The answer of You Make the Call-Situation 2
Technical Products, Inc.,...

Question 15

While it is legal for a firm to require performance tests for its employees, the tests must meet the criteria of validity and reliability.

Accepted Answer

A) True 
 B)False

Question 16

Keys to developing effective bonus plans include all of the following EXCEPT

Accepted Answer

A)  Setting attainable goals. 
B)  Including employees in planning. 
C)  Keep updating the goals. 
D)  Discontinuing the bonus plan periodically. 
A)  Setting attainable goals. 
B)  Including employees in planning. 
C)  Keep updating the goals. 
D)  Discontinuing the bonus plan periodically.

Question 17

Since leasing companies typically employ hundreds or thousands of people, they can afford to offer benefits superior to those offered by the typical small firm.

Accepted Answer

A) True 
 B)False

Question 18

Small companies are more likely to employ immigrants than larger firms.

Accepted Answer

A) True 
 B)False

Question 19

One program designed to make on-the-job training effective is

Accepted Answer

A)  job specification. 
B)  co-worker accountability. 
C)  job description. 
D)  job instruction training. 
A)  job specification. 
B)  co-worker accountability. 
C)  job description. 
D)  job instruction training.

Question 20

Explain the nature of orientation programs and why they are needed.

Accepted Answer

Orientation programs consist of training

Exam 20: Managing Human Resources

Discuss the use of compensation and incentives in recruiting employees for small businesses.

Karl Milgram is concerned that many employees who successfully passed their employment test later perform poorly on the job. He believes the employment test lacks

Profit sharing provides a more direct work incentive in small firms than it does in large firms.

Secondary and trade schools are a likely source of

One of the largest expense categories for most businesses is

A small business owner wishes to persuade a highly qualified applicant (a business school graduate) to consider a position with his firm carefully, even though the applicant has also had offers from large corporations. The owner should most strongly emphasize the

In seeking personnel for non-critical positions, small firms sometimes turn to

The Americans with Disabilities Act requires employers to make _____ adaptations to facilitate the employment of individuals protected by the act.

Fringe benefits are expensive, amounting to more than 40 percent of payroll expense for many small firms.

Management and other key personnel "get a piece of the action" through

As part of preparing a business plan, Grace Wang wishes to show the cost of fringe benefits as a percentage of payroll costs. She should use the following percentage:

As a firm grows, it experiences pressure to formalize its personnel policies and procedures.

James Sandberg is investigating the advantages of employee leasing. It appears that the greatest benefit will be to free him and his firm from

While it is legal for a firm to require performance tests for its employees, the tests must meet the criteria of validity and reliability.

Keys to developing effective bonus plans include all of the following EXCEPT

Since leasing companies typically employ hundreds or thousands of people, they can afford to offer benefits superior to those offered by the typical small firm.

Small companies are more likely to employ immigrants than larger firms.

One program designed to make on-the-job training effective is

Explain the nature of orientation programs and why they are needed.

The Entrepreneurial Life

Entrepreneurial Integrity and Ethics

Getting Started

Franchises and Buyouts

The Family Business

The Business Plan: Visualizing the Dream

The Marketing Plan

The Human Resources Plan: Managers, Owners, Allies, and Directors

The Location Plan

Understanding a Firms Financial Statements

Forecasting Financial Requirements

A Firms Sources of Financing

Planning for the Harvest

Building Customer Relationships

Product and Supply Chain Management

Pricing and Credit Decisions

Promotional Planning

Global Opportunities for Small Business

Professional Management in the Entrepreneurial Firm

Managing Operations

Managing the Firms Assets

Managing Risk in the Small Business

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