Quiz 10: Compensation Management

Human Resource Management

Business
93
Questions
23
True/False
63
Choices
7
Essay
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Questions

Q1
Free

__________is the total of an employee's pay and benefits.

Multiple Choice
expand_more
A) Broadbanding
B) Delayering
C) Pay Structure
D) Wage Compression
E) Compensation
Answer:
E) Compensation
Q2
Free

Colton's salary is $40,000 per year. This part of his compensation is considered ________.

Multiple Choice
expand_more
A) base pay
B) wage and salary add-on
C) incentive pay
D) benefits
E) profit sharing
Answer:
A) base pay
Q3
Free

Andrew earns $12 per hour during regular shifts. However, when he has to work the night shift, his pay goes up to $14 per hour. This part of his compensation is considered ________.

Multiple Choice
expand_more
A) base pay
B) a wage and salary add-on
C) incentive pay
D) benefits
E) profit sharing
Answer:
B) a wage and salary add-on
Q4

If Brittany reaches her sales goals for this quarter, she will receive a $2,000 bonus. This part of her compensation is considered ________.

Multiple Choice
expand_more
A) base pay
B) a wage and salary add-on
C) incentive pay
D) benefits
E) profit sharing
Answer:

A) You need to subscribe to get the answer.

Q5

Casey's compensation includes health and dental insurance. This part of her compensation is considered ________.

Multiple Choice
expand_more
A) base pay
B) a wage and salary add-on
C) incentive pay
D) benefits
E) profit sharing
Answer:

A) You need to subscribe to get the answer.

Q6

Halle plans to pay her workers the lowest hourly rate of pay generally allowed under the Fair Labor Standards Act. In other words, Halle will pay her workers _________.

Multiple Choice
expand_more
A) skill-based pay
B) overtime wages
C) at-the-market wages
D) minimum wage
E) profit wages
Answer:

A) You need to subscribe to get the answer.

Q7

What is the law that governs federal minimum wage and overtime rules?

Multiple Choice
expand_more
A) Social Security Act
B) Equal Employment Opportunity Act
C) Fair Labor Standards Act
D) Maximum Hour and Wage Act
E) Federal Minimum Wage Act
Answer:

A) You need to subscribe to get the answer.

Q8

The FLSA includes information on each of the following EXCEPT:

Multiple Choice
expand_more
A) Minimum wage.
B) Exempt employees.
C) Overtime.
D) Benefits.
E) Child labor.
Answer:

A) You need to subscribe to get the answer.

Q9

The first major provision of the FLSA concerns ____________________.

Multiple Choice
expand_more
A) underage employees
B) the unskilled workforce
C) new hires
D) the federal minimum wage
E) profit sharing
Answer:

A) You need to subscribe to get the answer.

Q10

_____ is a concept that when jobs are distinctly different but entail similar levels of ability, responsibility, skills, and working conditions, they are of equal value and should have the same pay scale.

Multiple Choice
expand_more
A) Equal worth
B) Comparable worth
C) Equitable value
D) Differential value
E) Comparable value
Answer:

A) You need to subscribe to get the answer.

Q11

When Stephanie compares the work required in her job to the work required in Heather's job, she finds that the two jobs are similar. While the work in the jobs is different, the jobs involve similar responsibility, skills, and working conditions. However, Heather is paid $2 an hour more than Stephanie is paid. Stephanie's findings appear to reveal a violation of ________.

Multiple Choice
expand_more
A) pay secrecy
B) comparable worth
C) equal pay
D) market rates
E) profit sharing
Answer:

A) You need to subscribe to get the answer.

Q12

__________is the process of determining the worth of each position relative to the other positions within the organization.

Multiple Choice
expand_more
A) Delayering
B) Job evaluation
C) Expectancy theory
D) Equity theory
E) Compensation
Answer:

A) You need to subscribe to get the answer.

Q13

The job ranking method of job evaluation simply ranks jobs ___________________.

Multiple Choice
expand_more
A) based on education attainment
B) from most- to least-desirable
C) from lowest to highest
D) based on number of job openings
E) based on pay
Answer:

A) You need to subscribe to get the answer.

Q14

____________________ of job evaluation break a job down into components and then apply points to each of the factors based on that factor's difficulty.

Multiple Choice
expand_more
A) FLSA requirements
B) Performance evaluations
C) Point-factor methods
D) Undercompensated employees
E) Ranking methods
Answer:

A) You need to subscribe to get the answer.

Q15

Compensable factors:

Multiple Choice
expand_more
A) are the determining factors in individual pay rates.
B) provide information on psychological success in a particular job.
C) provide information on physical success in a particular job.
D) would include factors such as essential functions in a job.
E) are usually identified by interviewing the individual job-holder.
Answer:

A) You need to subscribe to get the answer.

Q16

Which job evaluation method begins by comparing benchmark jobs and then uses both point factors and ranking?

Multiple Choice
expand_more
A) Job classification
B) Decision banding
C) Job elements
D) Factor comparison
E) Hay Guide
Answer:

A) You need to subscribe to get the answer.

Q17

_________is a hierarchy of jobs and their rates of pay within the organization.

Multiple Choice
expand_more
A) Expectancy theory
B) Compensation
C) Pay structure
D) Broadbanding
E) Equity theory
Answer:

A) You need to subscribe to get the answer.

Q18

__________is the maximum, minimum, and midpoint of pay for a certain group of jobs.

Multiple Choice
expand_more
A) Rate range
B) Compensation
C) Pay structure
D) Broadbanding
E) Overtime
Answer:

A) You need to subscribe to get the answer.

Q19

When there are more workers available than jobs, the market can get some of them to work for ________.

Multiple Choice
expand_more
A) more than the normal rate
B) extra benefits
C) less than the normal rate
D) product market competition
E) fewer breaks
Answer:

A) You need to subscribe to get the answer.

Q20

_______ is a function of the value of the product or service that the organization sells to the customer.

Multiple Choice
expand_more
A) Expectancy theory
B) Compensation
C) Pay structure
D) Product market competition
E) Equity theory
Answer:

A) You need to subscribe to get the answer.

Q21

__________is the process of changing the company structure to get rid of some of the vertical hierarchy (reporting levels) in an organization.

Multiple Choice
expand_more
A) Delayering
B) Equity theory
C) Broadbanding
D) Pay structure
E) Compensation
Answer:

A) You need to subscribe to get the answer.

Q22

__________involves combining multiple pay levels into one pay level.

Multiple Choice
expand_more
A) Delayering
B) Equity theory
C) Broadbanding
D) Wage compression
E) Pay structure
Answer:

A) You need to subscribe to get the answer.

Q23

Green-circle rates:

Multiple Choice
expand_more
A) are paid at the midpoint for a particular class of jobs.
B) are paid above a particular class of jobs.
C) are paid below a particular class of jobs.
D) are not counted in the pay structure.
E) are benchmark jobs in the overall pay structure.
Answer:

A) You need to subscribe to get the answer.

Q24

Overlapping _____ allows flexibility in assigning each person's pay rate within a particular pay level.

Multiple Choice
expand_more
A) pay levels
B) pay lines
C) job evaluations
D) compensable factors
E) benchmark jobs
Answer:

A) You need to subscribe to get the answer.

Q25

If you find a red-circle rate in a particular pay level, you should probably:

Multiple Choice
expand_more
A) not allow the person to get any new raises because they are already being paid too much.
B) recheck your figures because you have a miscalculation in your salary computations.
C) move the person up to at least the bottom of the pay level for their job.
D) broadband the pay scale to put them in the boundary for that job.
E) promote the individual because it is obvious that they work harder than others in their department.
Answer:

A) You need to subscribe to get the answer.

Q26

Hayley is plotting a graphic of where the employees in her organization fall in the pay structure. She discovers that Vladimir's pay is much higher than his assigned pay level. What Hayley has discovered is a _______.

Multiple Choice
expand_more
A) green-circle rate
B) red-circle rate
C) skill-based rate
D) delayered rate
E) overage rate
Answer:

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Q27

_________-circle rates are those that are lower than the bottom of the pay range.

Multiple Choice
expand_more
A) Red
B) Orange
C) Yellow
D) Green
E) Blue
Answer:

A) You need to subscribe to get the answer.

Q28

_________-circle rates are those that are higher than the top of the pay range.

Multiple Choice
expand_more
A) Red
B) Orange
C) Yellow
D) Green
E) Blue
Answer:

A) You need to subscribe to get the answer.

Q29

Compensation components include all rewards that can be classified as monetary payments and in-kind payments.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q30

Compensation components only include monetary payments to an employee.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q31

When we design compensation programs, we are trying to motivate the employee to do the things that we need them to do, consistently, over a period of time.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q32

Ability to pay is determined by assessing estimated revenues from business operations, then deciding what percentage of revenues go toward compensation costs.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q33

Wage compression widens the pay gap between new and experienced employees.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q34

Wage compression weakens the desired link between pay and performance.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q35

Organizations can have a performance or a longevity philosophy to compensation.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q36

The longevity philosophy of compensation monetarily rewards employees for their loyalty to the firm.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q37

Performance philosophies of compensation don't tend to work well in competitive industries.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q38

Competency-based or skill-based pay will hinge partly on what skills employees bring to work and whether or not those skills are needed.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q39

Competencies and skills are the same thing.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q40

Efficiency wage theory says that if a company pays higher wages, it can generally hire better people who will in turn be more productive.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q41

Pay secrecy clauses are becoming more dangerous to companies who choose to enforce them.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q42

Virtually every EEO law identifies compensation as one of the employment actions where discrimination is prohibited if it is based on a protected characteristic.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q43

Comparable worth means "equal pay for equal work."

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q44

Comparable worth legislation has been proposed as a solution to the problem of persistent gender inequity in pay.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q45

Comparable worth means "similar pay for similar work."

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q46

Delayering is the process of determining the worth of each position relative to the other positions within the organization

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q47

The factor comparison method of job evaluation combines the job ranking and point-factor methods.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q48

A pay structure is a hierarchy of jobs and their rates of pay within the organization.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q49

In compensation, a pay structure is the maximum, minimum, and midpoint of pay for a certain group of jobs.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q50

Broadbanding is the process of changing the company structure to get rid of some of the vertical hierarchy (reporting levels) in an organization.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q51

Delayering is the process of combining multiple pay levels into one.

True/False
expand_more
A) True.
B) False.
Answer:

Subscribe First.

Q52

What are the four types of compensation?

Essay
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Answer:

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Q53

When setting up a compensation system, what issues does an organization need to address to determine its compensation philosophy?

Essay
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Answer:

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Q54

What is wage compression and how does it occur?

Essay
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Answer:

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Q55

If minimum wage is $7.25, why can servers be paid $2.13?

Essay
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Answer:

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Q56

What does "comparable worth" mean in a compensation context?

Essay
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Answer:

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Q57

What are the three methods of job evaluation discussed in the book?

Essay
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Answer:

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Q58

What are green-circle rates and red-circle rates in a pay structure?

Essay
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Answer:

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Q59

__________ includes anything that an employee may value and desire and that the employer is willing and able to offer in exchange.

Multiple Choice
expand_more
A) Compensation system
B) Equity theory
C) Wage compression
D) Broadbanding
E) Pay structure
Answer:

A) You need to subscribe to get the answer.

Q60

________ are all rewards that can be classified as monetary payments and in-kind payments.

Multiple Choice
expand_more
A) Benefits
B) Compensation components
C) Wages
D) Broadbands
E) Base pay
Answer:

A) You need to subscribe to get the answer.

Q61

________ are/is all rewards other than monetary and in-kind payments.

Multiple Choice
expand_more
A) Premium pay
B) Incentives
C) Wages
D) Heath benefits
E) Noncompensation components
Answer:

A) You need to subscribe to get the answer.

Q62

__________is a theory proposing that employees are motivated when they believe they can accomplish a task and that the rewards for doing so are worth the effort.

Multiple Choice
expand_more
A) Wage compression
B) Pay structure
C) Expectancy theory
D) Broadbanding
E) Equity theory
Answer:

A) You need to subscribe to get the answer.

Q63

__________is a theory that employees are motivated when the ratio of their perceived outcomes to inputs is at least roughly equal to that of other referent individuals.

Multiple Choice
expand_more
A) Broadbanding
B) Equity theory
C) Expectancy theory
D) Wage compression
E) Delayering
Answer:

A) You need to subscribe to get the answer.

Q64

Martha was promised a 10% raise if she wins a contract with the city government. Martha could use the money to pay off some debts. However, she happens to know that another company already has informally won the contract. There is a very slim chance that she could win the contract away from the other organization, but she does not believe she can do it. According to expectancy theory, Martha is unmotivated to try to win the contract because she lacks __________.

Multiple Choice
expand_more
A) valence
B) instrumentality
C) expectancy
D) significance
E) confidence
Answer:

A) You need to subscribe to get the answer.

Q65

Conner has received steady pay increases over the years for his solid sales performance. This year, the organization merged with another organization and money has become tight. Conner doubts there's any money available for raises. Therefore, he has not been motivated to work as hard. According to expectancy theory, Conner is unmotivated because _________ is lacking.

Multiple Choice
expand_more
A) valence
B) instrumentality
C) expectancy
D) significance
E) confidence
Answer:

A) You need to subscribe to get the answer.

Q66

Jacob's manager asks him to organize a blood drive for the organization. The manager tells Jacob that if he accepts the assignment, he will be awarded Employee of the Month. Jacob has organized blood drives in the past and knows how much work is involved. He does not doubt that his manager can deliver on the promise of the award. However, Jacob has always thought that the award was silly. According to expectancy theory, Jacob is unmotivated to accept the assignment because _________ is lacking.

Multiple Choice
expand_more
A) valence
B) instrumentality
C) expectancy
D) significance
E) confidence
Answer:

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Q67

Aryn and Mary started at the organization on the same day. Both are hard workers and perceive that they are equitably rewarded for their efforts. According to equity theory, it is likely that both will ________.

Multiple Choice
expand_more
A) request a raise
B) worker harder or longer
C) do less work
D) continue to put forth effort
E) None of the above
Answer:

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Q68

In setting the base pay rate for new jobs at her organization, Alexis is doing an assessment of how much she can afford to pay. She is working on the ________ portion of her organizational philosophy on compensation.

Multiple Choice
expand_more
A) ability to pay
B) types of compensation
C) pay for performance or longevity
D) skill or competency-based pay
E) None of the above
Answer:

A) You need to subscribe to get the answer.

Q69

________ is an honest assessment of how much we can afford, or are willing to afford, in order to compensate our employees.

Multiple Choice
expand_more
A) Ability to pay
B) Pay for performance
C) At-market pay
D) Above-market pay
E) Wage compression
Answer:

A) You need to subscribe to get the answer.

Q70

_______refers to the mix of the four basic components of compensation"”base pay, wage add-ons, incentives, and benefits"”that we employ. We must divide available funds among the components.

Multiple Choice
expand_more
A) Ability to pay
B) Pay for performance
C) At-market pay
D) Types of compensation
E) Wage compression
Answer:

A) You need to subscribe to get the answer.

Q71

Which of the following is NOT one of the four basic components of compensation?

Multiple Choice
expand_more
A) Base pay
B) Wage add-ons
C) Incentives
D) Expectancy pay
E) Benefits
Answer:

A) You need to subscribe to get the answer.

Q72

Mimi is redesigning the compensation mix at her organization to include more family-friendly benefits such as child and elder care. Mimi is working on the ________ portion of her organizational philosophy on compensation.

Multiple Choice
expand_more
A) ability to pay
B) types of compensation
C) wage compression
D) skill or competency-based pay
E) None of the above
Answer:

A) You need to subscribe to get the answer.

Q73

Jim just reached his 10-year anniversary with Acme Global. The company gave him a promotion and raise for being a loyal member of the organization. It appears Acme Global's compensation philosophy is _______.

Multiple Choice
expand_more
A) below-the-market
B) at-the-market
C) pay for longevity
D) wage compression
E) None of the above
Answer:

A) You need to subscribe to get the answer.

Q74

Morgan is working on the compensation package for bank tellers. Bank customers like to see the same faces in the bank when they come in to talk about their money. Therefore, Morgan needs to find a way to reduce turnover among the tellers. Adopting a(n) _________ organizational philosophy on compensation might be a good idea.

Multiple Choice
expand_more
A) below-the-market
B) at-the-market
C) pay for longevity
D) wage compression
E) None of the above
Answer:

A) You need to subscribe to get the answer.

Q75

Courtney's organization is in a very competitive industry and getting goods to market quickly is vital to the organization's survival. For Courtney, adopting a(n) _________ organizational philosophy on compensation might be a good idea.

Multiple Choice
expand_more
A) at-the-market
B) below-the-market
C) pay for performance
D) wage compression
E) None of the above
Answer:

A) You need to subscribe to get the answer.

Q76

_______ refers to an organizational philosophy that bases pay on organizational loyalty/tenure.

Multiple Choice
expand_more
A) Pay for performance
B) Pay for longevity
C) Skill-based pay
D) At-market pay
E) Below-market pay
Answer:

A) You need to subscribe to get the answer.

Q77

_______ refers to an organizational philosophy that bases pay on employees' performance in their jobs.

Multiple Choice
expand_more
A) Pay for performance
B) Pay for longevity
C) Above-market pay
D) At-market pay
E) Below-market pay
Answer:

A) You need to subscribe to get the answer.

Q78

Which of the following is a type of incentive compensation?

Multiple Choice
expand_more
A) Base pay
B) Benefits
C) Wage compression
D) Skill-based pay
E) Broadbanding
Answer:

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Q79

If we pay our employees for knowledge, skills, and abilities they may never use in the workplace, our overall compensation cost ____________.

Multiple Choice
expand_more
A) does not change
B) changes insignificantly
C) goes down
D) goes up
E) None of the above
Answer:

A) You need to subscribe to get the answer.

Q80

Krista's organization uses a differentiation strategy. To encourage workers to bring knowledge, skills, and abilities to the job that can allow them to analyze problems and come up with creative solutions, Krista might adopt a(n)________ organizational philosophy on compensation.

Multiple Choice
expand_more
A) pay secrecy
B) above-the-market
C) at-the-market
D) competency-based pay
E) profit sharing
Answer:

A) You need to subscribe to get the answer.

Q81

_____ theory notes that if a company pays higher wages, it can generally hire better people who will in turn be more productive.

Multiple Choice
expand_more
A) Tournament
B) Signaling pay
C) Efficiency wage
D) Operational wage
E) Equity
Answer:

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Q82

Mad Max retail store hires workers for $8.50 per hour, which is the same hourly rate as other nearby retail stores. Mad Max is paying _________.

Multiple Choice
expand_more
A) minimum wage
B) at market
C) above market
D) below market
E) profit sharing
Answer:

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Q83

Sweet Sal's drive-thru eatery pays just above minimum wage, but other restaurants pay their workers more. Sweet Sal's is paying ___________.

Multiple Choice
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A) minimum wage
B) at market
C) above market
D) below market
E) profit sharing
Answer:

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Q84

The best reason to pay above market is:

Multiple Choice
expand_more
A) to attract better workers and enhance our employment brand
B) to take advantage of tax incentives
C) to keep the unemployment rates down
D) to invest in workforce development opportunities
E) to avoid negligent hires
Answer:

A) You need to subscribe to get the answer.

Q85

Trendy Tina's tech shop pays higher wages than any other electronics store in town. Trendy Tina's is paying ________

Multiple Choice
expand_more
A) minimum wage
B) at market
C) above market
D) below market
E) profit sharing
Answer:

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Q86

Mallory would like to attract better workers and enhance her organization's employment brand. Adopting a(n) ________ organizational philosophy on compensation could help her achieve her goals.

Multiple Choice
expand_more
A) at-the-market
B) above-the-market
C) pay for longevity
D) pay secrecy
E) profit pay
Answer:

A) You need to subscribe to get the answer.

Q87

Katrina's organization is hiring for low-skilled jobs in an industry where unemployment is high and it is easy to find replacement workers. Adopting a(n) ________ organizational philosophy on compensation could allow her to hire plenty of workers.

Multiple Choice
expand_more
A) wage compression
B) below-the-market
C) pay for longevity
D) competency-based pay
E) profit pay
Answer:

A) You need to subscribe to get the answer.

Q88

To attract better workers and enhance the organization's employment brand, which philosophy of compensation might an organization chose?

Multiple Choice
expand_more
A) Pay secrecy
B) Pay for longevity
C) Above-market pay
D) At-market pay
E) Below-market pay
Answer:

A) You need to subscribe to get the answer.

Q89

If unemployment is high and it is easy to find replacement workers, which philosophy of compensation might an organization chose?

Multiple Choice
expand_more
A) Pay for performance
B) Pay for longevity
C) Above-market pay
D) At-market pay
E) Below-market pay
Answer:

A) You need to subscribe to get the answer.

Q90

__________occurs when new employees require higher starting pay than the historical norm, causing narrowing of the pay gap between experienced and new employees.

Multiple Choice
expand_more
A) Equity theory
B) Pay structure
C) Delayering
D) Wage compression
E) Broadbanding
Answer:

A) You need to subscribe to get the answer.

Q91

_____ occurs when the gap between pay for newcomers and veteran employees narrows because of changing economic conditions over time.

Multiple Choice
expand_more
A) Pay depression
B) Wage compression
C) Leveling
D) Econometric distribution
E) Equalization
Answer:

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Q92

__________is the lowest hourly rate of pay generally permissible by federal law.

Multiple Choice
expand_more
A) Rate range
B) Wage compression
C) Pay structure
D) Compensation
E) Minimum wage
Answer:

A) You need to subscribe to get the answer.

Q93

__________is a higher than minimum, federally mandated wage, required for nonexempt employees if they work more than a certain number of hours in a week.

Multiple Choice
expand_more
A) Broadbanding
B) Compensation
C) Pay structure
D) Delayering
E) Overtime
Answer:

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