Question 1

Gainsharing plans encompass more than just a monetary component.

Accepted Answer

A) True 
 B)False

Question 2

Merit pay systems rely on 360-degree performance feedback.

Accepted Answer

A) True 
 B)False

Question 3

At the end a successful project launch, Cedar Creek gives its employees a financial incentive. George knows that it will be rolled into his base pay.

Accepted Answer

A) True 
 B)False

Question 4

According to the agency theory, who are the principals?

Accepted Answer

A)  Managers 
B)  Customers 
C)  Owners 
D)  Vendors 
E)  Employees 
A)  Managers 
B)  Customers 
C)  Owners 
D)  Vendors 
E)  Employees

Question 5

Valence of pay outcomes should change according to different pay systems.

Accepted Answer

A) True 
 B)False

Question 6

During Benjamin's orientation he considers leaving the company because he saw a few people whispering and making fun of another colleague. Which of the following are influencing his decision?

Accepted Answer

A)  Membership behaviors 
B)  Organizational behaviors 
C)  Group dynamics 
D)  Organizational structures 
E)  Organizational norms 
A)  Membership behaviors 
B)  Organizational behaviors 
C)  Group dynamics 
D)  Organizational structures 
E)  Organizational norms

Question 7

A(n) ________ program is based on group or plant performance that does not become part of the employee's base salary.

Accepted Answer

A)  merit pay 
B)  profit-sharing 
C)  stock option 
D)  gainsharing 
E)  individual incentive 
A)  merit pay 
B)  profit-sharing 
C)  stock option 
D)  gainsharing 
E)  individual incentive

Question 8

In merit pay programs, an individual's compa-ratio represents his or her

Accepted Answer

A)  ability to multitask. 
B)  performance rating. 
C)  position in the pay range. 
D)  knowledge of business. 
E)  ratio of pay to benefits. 
A)  ability to multitask. 
B)  performance rating. 
C)  position in the pay range. 
D)  knowledge of business. 
E)  ratio of pay to benefits.

Question 9

Employees assess fairness along the distributive dimension when their assessment is based on

Accepted Answer

A)  organizational procedures. 
B)  the systems used to assess performance. 
C)  how much they receive. 
D)  supervisors' feedback. 
E)  their judgment of the management. 
A)  organizational procedures. 
B)  the systems used to assess performance. 
C)  how much they receive. 
D)  supervisors' feedback. 
E)  their judgment of the management.

Question 10

According to expectancy theory, which of the following is the main influence of compensation?

Accepted Answer

A)  Expectancy 
B)  Instrumentality 
C)  Reinforcement 
D)  Valence 
E)  Equity 
A)  Expectancy 
B)  Instrumentality 
C)  Reinforcement 
D)  Valence 
E)  Equity

Question 11

When an organization is using growth strategy, it will

Accepted Answer

A)  have pay levels that are below market levels in the short run. 
B)  have a time orientation that is short-term. 
C)  make centralized pay decisions. 
D)  not share risks with employees. 
E)  have benefit levels that are above market levels. 
A)  have pay levels that are below market levels in the short run. 
B)  have a time orientation that is short-term. 
C)  make centralized pay decisions. 
D)  not share risks with employees. 
E)  have benefit levels that are above market levels.

Question 12

Which of the following must a principal do to reduce agency costs?

Accepted Answer

A)  Encourage the agent to maximize his or her benefits 
B)  Provide complete autonomy to the agent 
C)  Discourage the agent from pursuing projects with high potential payoffs 
D)  Increase information asymmetry and goal congruence 
E)  Align the agent's interests with the principal's interests 
A)  Encourage the agent to maximize his or her benefits 
B)  Provide complete autonomy to the agent 
C)  Discourage the agent from pursuing projects with high potential payoffs 
D)  Increase information asymmetry and goal congruence 
E)  Align the agent's interests with the principal's interests

Question 13

Gainsharing plans differ from profit-sharing plans in that

Accepted Answer

A)  gainsharing plans use organization-wide performance parameters. 
B)  gainsharing plans distribute payouts more frequently. 
C)  gainsharing plans make lump sum payments. 
D)  gainsharing plans can be attached to all types of jobs in the organization. 
E)  gainsharing plans discourage pursuit of broader goals of the group. 
A)  gainsharing plans use organization-wide performance parameters. 
B)  gainsharing plans distribute payouts more frequently. 
C)  gainsharing plans make lump sum payments. 
D)  gainsharing plans can be attached to all types of jobs in the organization. 
E)  gainsharing plans discourage pursuit of broader goals of the group.

Question 14

Which of the following statements about outcome-oriented or behavior-oriented contracts is true?

Accepted Answer

A)  Merit pay is an example of an outcome-based contract. 
B)  Behavior-oriented contracts do not transfer risk to the agent. 
C)  Outcome-oriented contracts do not require a compensating wage differential. 
D)  Outcome-oriented contracts decrease the agent's risks. 
E)  In behavior-based contracts, information asymmetry is not an important issue. 
A)  Merit pay is an example of an outcome-based contract. 
B)  Behavior-oriented contracts do not transfer risk to the agent. 
C)  Outcome-oriented contracts do not require a compensating wage differential. 
D)  Outcome-oriented contracts decrease the agent's risks. 
E)  In behavior-based contracts, information asymmetry is not an important issue.

Question 15

If Jonah and Xiomara want to keep their individual incentives, then

Accepted Answer

A)  they will need to contribute to a more disintegrated workforce. 
B)  they will be helpful in the pursuit of total quality management objectives. 
C)  they will encourage other employees to go beyond the call of duty. 
D)  they will reduce their motivation of acquiring multiple skills and proactive problem solving. 
E)  they must realize that they are continuously earned and re-earned. 
A)  they will need to contribute to a more disintegrated workforce. 
B)  they will be helpful in the pursuit of total quality management objectives. 
C)  they will encourage other employees to go beyond the call of duty. 
D)  they will reduce their motivation of acquiring multiple skills and proactive problem solving. 
E)  they must realize that they are continuously earned and re-earned.

Question 16

Employee stock ownership plans (ESOPs) carry significant investment risks for employees.

Accepted Answer

A) True 
 B)False

Question 17

In a merit increase grid, the ________ determines the size and frequency of pay increases.

Accepted Answer

A)  time spent in the current pay grade 
B)  overall profitability of the company 
C)  employees' seniority 
D)  compa-ratio of employees 
E)  the skill developed by the employee 
A)  time spent in the current pay grade 
B)  overall profitability of the company 
C)  employees' seniority 
D)  compa-ratio of employees 
E)  the skill developed by the employee

Question 18

Which of the following pay strategy dimensions best fits with a business strategy of concentration?

Accepted Answer

A)  Long-term time orientation 
B)  Below-market short-run pay level 
C)  High levels of variable pay 
D)  Above-market benefits levels 
E)  Decentralization of pay decisions 
A)  Long-term time orientation 
B)  Below-market short-run pay level 
C)  High levels of variable pay 
D)  Above-market benefits levels 
E)  Decentralization of pay decisions

Question 19

Which of the following is true of how agents may differ from principals?

Accepted Answer

A)  Agents can diversify the risks more easily. 
B)  Agents are more likely to pursue projects with high potential payoffs. 
C)  Agents can diversify investments better. 
D)  Agents are more averse to risk. 
E)  Agents are likely to prefer more emphasis on uncertain incentives than base pay. 
A)  Agents can diversify the risks more easily. 
B)  Agents are more likely to pursue projects with high potential payoffs. 
C)  Agents can diversify investments better. 
D)  Agents are more averse to risk. 
E)  Agents are likely to prefer more emphasis on uncertain incentives than base pay.

Question 20

Discuss the organization strategies of concentration and growth and how they influence pay dimensions.

Accepted Answer

Growth strategies emphasize innovation,

Gainsharing plans encompass more than just a monetary component.

Merit pay systems rely on 360-degree performance feedback.

At the end a successful project launch, Cedar Creek gives its employees a financial incentive. George knows that it will be rolled into his base pay.

According to the agency theory, who are the principals?

Valence of pay outcomes should change according to different pay systems.

During Benjamin's orientation he considers leaving the company because he saw a few people whispering and making fun of another colleague. Which of the following are influencing his decision?

A(n) ________ program is based on group or plant performance that does not become part of the employee's base salary.

In merit pay programs, an individual's compa-ratio represents his or her

Employees assess fairness along the distributive dimension when their assessment is based on

According to expectancy theory, which of the following is the main influence of compensation?

When an organization is using growth strategy, it will

Which of the following must a principal do to reduce agency costs?

Gainsharing plans differ from profit-sharing plans in that

Which of the following statements about outcome-oriented or behavior-oriented contracts is true?

If Jonah and Xiomara want to keep their individual incentives, then

Employee stock ownership plans (ESOPs) carry significant investment risks for employees.

In a merit increase grid, the ________ determines the size and frequency of pay increases.

Which of the following pay strategy dimensions best fits with a business strategy of concentration?

Which of the following is true of how agents may differ from principals?

Discuss the organization strategies of concentration and growth and how they influence pay dimensions.

Human Resource Management: Gaining a Competitive Advantage

Strategic Human Resource Management

The Legal Environment: Equal Employment Opportunity and Safety

The Analysis and Design of Work

Human Resource Planning and Recruitment

Selection and Placement

Training

Performance Management

Employee Development

Employee Separation and Retention

Pay Structure Decisions

Employee Benefits

Collective Bargaining and Labor Relations

Managing Human Resources Globally

Strategically Managing the HRM Function

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Exam 12: Recognizing Employee Contributions With Pay

Gainsharing plans encompass more than just a monetary component.

Merit pay systems rely on 360-degree performance feedback.

At the end a successful project launch, Cedar Creek gives its employees a financial incentive. George knows that it will be rolled into his base pay.

According to the agency theory, who are the principals?

Valence of pay outcomes should change according to different pay systems.

During Benjamin's orientation he considers leaving the company because he saw a few people whispering and making fun of another colleague. Which of the following are influencing his decision?

A(n) ________ program is based on group or plant performance that does not become part of the employee's base salary.

In merit pay programs, an individual's compa-ratio represents his or her

Employees assess fairness along the distributive dimension when their assessment is based on

According to expectancy theory, which of the following is the main influence of compensation?

When an organization is using growth strategy, it will

Which of the following must a principal do to reduce agency costs?

Gainsharing plans differ from profit-sharing plans in that

Which of the following statements about outcome-oriented or behavior-oriented contracts is true?

If Jonah and Xiomara want to keep their individual incentives, then

Employee stock ownership plans (ESOPs) carry significant investment risks for employees.

In a merit increase grid, the ________ determines the size and frequency of pay increases.

Which of the following pay strategy dimensions best fits with a business strategy of concentration?

Which of the following is true of how agents may differ from principals?

Discuss the organization strategies of concentration and growth and how they influence pay dimensions.

Human Resource Management: Gaining a Competitive Advantage

Strategic Human Resource Management

The Legal Environment: Equal Employment Opportunity and Safety

The Analysis and Design of Work

Human Resource Planning and Recruitment

Selection and Placement

Training

Performance Management

Employee Development

Employee Separation and Retention

Pay Structure Decisions

Employee Benefits

Collective Bargaining and Labor Relations

Managing Human Resources Globally

Strategically Managing the HRM Function

Filters