Quiz 1

Question 1

T or F: Total compensation includes psychological aspects of work such as recognition and status, challenging work and learning opportunities

Answer 1

False

Question 2

T or F: Base pay is the cash compensation an employer pays for the work performed

Answer 2

True

Question 3

T or F: Cost of living adjustment refers to percentage increment to base pay provided to employees based on their performance

Answer 3

False

Question 4

T or F: Merit pay is a one time payment for meeting previously established performance objectives

Answer 4

False

Question 5

T or F: Incentives may be long term or short term

Answer 5

True

Question 6

T or F: Taking a strategic perspective requires a focus on compensation decisions, but helps the organization gain and sustain competitive advantage

Answer 6

True

Question 7

T or F: The underlying premise of the support business strategy is that the greater the alignment between the organization and compensation system, the more effective the organization

Answer 7

True

Question 8

T or F: When business strategies change, pay systems should remain the same

Answer 8

False

Question 9

T or F: Internal alignment is the first pay policy issue in a strategic approach

Answer 9

True

Question 10

T or F: An internal pay structure is defined by the number of levels of work, the pay differentials between the levels, and the criteria used to define those levels and differentials

Answer 10

True

Question 11

T or F: In the context of the criteria used to determine levels of work and pay differentials, value refers to the work performed in a job and how it gets done

Answer 11

False

Question 12

T or F: A job based structure looks at the skills, knowledge or competencies the employee possesses

Answer 12

False

Question 13

T or F: Unions, stockholders, and even political groups have a stake in establishing internal pay structures

Answer 13

True

Question 14

T or F: Pay for non-entry jobs is buffered from external forces and is more heavily influenced by internal factors

Answer 14

True

Question 15

MC: Which of the following pay strategies is a source of competitive advantage?

Answer 15

A pay strategy that adds value and is difficult for employers to imitate

Question 16

MC: Which of the following statements is true about assessing the total compensation implications?

Answer 16

A pay system reflects the values that guide an employers behaviour and underlie its treatment of employees

Question 17

MC: According to the steps involved in formulating a total compensation strategy, which of the following is the step that follows the assessment of total compensation implications?

Answer 17

Mapping a total compensation strategy

Question 18

MC: Which of the following is a step in the formulation of the total compensation strategy that deals with setting objectives and specifying policies on alignment, competitiveness, contributions, and management?

Answer 18

Map a total compensation strategy

Question 19

MC: Mapping a total compensation strategy includes setting objectives and specifying policies on___

Answer 19

Contributions

Question 20

MC: Internal alignment refers primarily to__

Answer 20

The pay relationships among jobs, skills and competencies within a single organization

Question 21

MC: __ refers to the pay between the jobs/skills/competencies within a single organization

Answer 21

Internal equity

Question 22

MC: the array of pay rates for different work or skills within a single organization is referred to as ___

Answer 22

Pay structure

Question 23

MC: The process by which goods and services are delivered to the customer is known as ___

Answer 23

Workflow

Question 24

MC: ___ is the ability of the employee to see the link between an individual employees work and the achievement of organizational objectives

Answer 24

Line-of-sight

Question 25

T or F: When executive pay is excessive relative to company performance, profits are diverted away from stockholders to the executives

Answer 25

TRUE