Question 1

__________ is the single word that best describes the design of individual incentive plans.

Accepted Answer

A)  Motivation
B)  Comprehensiveness
C)  Flexibility
D)  Consistency

Question 2

Some of the benefits that Robix gives to its CEO and other top executives as a way to attract and retain talented individuals include chauffeurs, country club memberships, and special vacation policies. These are known as

Accepted Answer

A)  executive rewards.
B)  perquisites.
C)  golden parachutes.
D)  assigned benefits.

Question 3

Perquisites are special nonmonetary benefits given to executive employees.

Accepted Answer

A) True 
 B)False

Question 4

Group incentive plans include

Accepted Answer

A)  straight salary plan.
B)  improshare.
C)  straight commission plan.
D)  profit sharing.

Question 5

Which of the following is an individual type of incentive plan?

Accepted Answer

A)  Improshare
B)  Lump sum merit pay
C)  Stock options
D)  Employee stock ownership plans

Question 6

A major concern of executive compensation involves

Accepted Answer

A)  timing of the bonus.
B)  the amount of compensation.
C)  lack of perquisites.
D)  lack of objective market data.

Question 7

Robix just developed a complex incentive system in which the rewards provide purpose, as well as give autonomy to the workers and offer them the opportunity to master a skill. This new system was most likely designed to

Accepted Answer

A)  be an enterprise system.
B)  incentivize groups.
C)  attract manufacturing workers.
D)  reward professionals.

Question 8

Enterprise incentive plans include

Accepted Answer

A)  the Scanlon plan.
B)  improshare.
C)  stock options.
D)  sales incentives.

Question 9

Group incentive plans do all of the following EXCEPT

Accepted Answer

A)  enable employees to share the benefits of improved efficiency.
B)  encourage cooperation.
C)  reduce free-ride effect.
D)  reward employees for total contribution to organizational performance.

Question 10

According to Sammer, which of the following is NOT a characteristic of a successful incentive plan?

Accepted Answer

A)  Identify important organizational metrics that encourage employee behavior.
B)  Involve employees and have incentive programs that seem fair to employees.
C)  Find technically detailed, quantitative, and extremely thorough payout formulas.
D)  Establish a clear link between performance and payout.

Question 11

Management must be careful to ensure that incentive payments are viewed as both a reward and an entitlement.

Accepted Answer

A) True 
 B)False

Question 12

Discuss the problems identified with merit raises. As a manager, what could you do to ensure that merit raises fulfill their intended value?

Accepted Answer

Money available for merit increases may ...

Question 13

Employees are comfortable with the employee stock ownership plan because the federally established Pension Benefit Guaranty Corporation guarantees them their contribution to the plan.

Accepted Answer

A) True 
 B)False

Question 14

ESOPs can qualify as tax-exempt employee trusts under section __________ of the Internal Revenue Code.

Accepted Answer

A)  402(a) 
B)  457(k) 
C)  401(a) 
D)  407(k)

Question 15

When setting performance measures for incentive systems, we can say that the best measures are those that

Accepted Answer

A)  are quantitative, simple to understand, and show a clear relationship to improved performance.
B)  are qualitative, flexible, and create competition between employees.
C)  allow employers to "ratchet up" standards and base rewards on qualitative standards.
D)  reduce administrative costs, determine rewards based only on quantity, and reward only exceptional employees.

Question 16

Identify the principal methods for compensating salespersons and the advantages of each method.

Accepted Answer

Compensation plans for sales personnel m...

Question 17

In order to make sure that the pay they give their executives is similar to that of similar companies, Robix can use competitive benchmarking.

Accepted Answer

A) True 
 B)False

Question 18

Generally, a bonus plan does not become part of an employee's base pay.

Accepted Answer

A) True 
 B)False

Question 19

The CFO at Robix has been incentivized with a stock option that can only be exercised after a three-year vesting period. This is known as

Accepted Answer

A)  competitive benchmarking.
B)  a golden handcuff.
C)  the free-rider effect.
D)  rate busting.

Question 20

Research shows that a merit increase in the range of __________ is necessary to serve as a pay motivator.

Accepted Answer

A)  3 to 5 percent
B)  7 to 9 percent
C)  11 to 13 percent
D)  15 to 17 percent

Exam 10: Pay-For-Performance: Incentive Rewards

__________ is the single word that best describes the design of individual incentive plans.

Correct AnswerverifiedShow Answer

Discuss the problems identified with merit raises. As a manager, what could you do to ensure that merit raises fulfill their intended value?

Correct AnswerverifiedMoney available for merit increases may ...View AnswerShow Answer

Identify the principal methods for compensating salespersons and the advantages of each method.

Correct AnswerverifiedCompensation plans for sales personnel m...View AnswerShow Answer

Some of the benefits that Robix gives to its CEO and other top executives as a way to attract and retain talented individuals include chauffeurs, country club memberships, and special vacation policies. These are known as

Correct AnswerverifiedShow Answer

Enterprise incentive plans include

Correct AnswerverifiedShow Answer

When setting performance measures for incentive systems, we can say that the best measures are those that

Correct AnswerverifiedShow Answer

Research shows that a merit increase in the range of __________ is necessary to serve as a pay motivator.

Correct AnswerverifiedShow Answer

Perquisites are special nonmonetary benefits given to executive employees.

Correct AnswerverifiedShow Answer

In order to make sure that the pay they give their executives is similar to that of similar companies, Robix can use competitive benchmarking.

Correct AnswerverifiedShow Answer

According to Sammer, which of the following is NOT a characteristic of a successful incentive plan?

Correct AnswerverifiedShow Answer

Group incentive plans include

Correct AnswerverifiedShow Answer

A major concern of executive compensation involves

Correct AnswerverifiedShow Answer

ESOPs can qualify as tax-exempt employee trusts under section __________ of the Internal Revenue Code.

Correct AnswerverifiedShow Answer

Group incentive plans do all of the following EXCEPT

Correct AnswerverifiedShow Answer

Which of the following is an individual type of incentive plan?

Correct AnswerverifiedShow Answer

Employees are comfortable with the employee stock ownership plan because the federally established Pension Benefit Guaranty Corporation guarantees them their contribution to the plan.

Correct AnswerverifiedShow Answer

Management must be careful to ensure that incentive payments are viewed as both a reward and an entitlement.

Correct AnswerverifiedShow Answer

Generally, a bonus plan does not become part of an employee's base pay.

Correct AnswerverifiedShow Answer

Robix just developed a complex incentive system in which the rewards provide purpose, as well as give autonomy to the workers and offer them the opportunity to master a skill. This new system was most likely designed to

Correct AnswerverifiedShow Answer

The CFO at Robix has been incentivized with a stock option that can only be exercised after a three-year vesting period. This is known as

Correct AnswerverifiedShow Answer

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Money available for merit increases may ...
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Compensation plans for sales personnel m...
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