ch1 1. Which of the following includes restrictions on executive pay that are designed to discourage executives from taking "unnecessary and excessive risks"? A. Corporate Welfare Program B. Employee Welfare Program Ÿ C. Troubled Asset Relief Program D. Corporate Liability Relief Program 2. According to the text, if women had the same education, experience, and union coverage as men and also worked in the same industries and occupations, they would be expected to earn about _____ of what men earn. A. 62% B. 70% C. 80% Ÿ D. 90% 3. Hourly compensation costs for manufacturing workers are higher in _____ than the U.S. Ÿ A. Norway B. Japan C. Spain D. Singapore 4. Hourly compensation costs for manufacturing workers are lower in _____ than the U.S. Ÿ A. Korea B. Norway C. Sweden D. Netherlands 5. When executives decide where to locate a manufacturing plant, the most important consideration is: A. hourly compensation costs Ÿ B. labor productivity C. strength of local labor unions D. cost of government mandated benefits 6. _____ would be most concerned about executive pay. A. Managers B. Employees C. Society Ÿ D. Stockholders 7. _____ would be most concerned about compensation as a major expense. Ÿ A. Managers B. Employees C. Society D. Stockholders
8. The primary reason compensation is important to managers is because: A. employees regard it as a reward. Ÿ B. it influences employee behavior. C. it is a larger cost than benefits. D. stock holders dislike high compensation costs. 9. Employees view compensation as all but which of the following? A. A return B. An entitlement C. A reward Ÿ D. An investment 10. The degree to which pay influences individual and aggregate motivation among the employees at any point in time is referred to as: A. sorting effect. Ÿ B. incentive effect. C. motivational effect. D. directional effect. 13. Which of the following is an example of a relational return? A. Short-term incentives Ÿ B. Recognition and status C. Work-life balance D. Income protection 14. Which of the following are given as increments to the base pay in recognition of past work behavior? A. Base pay B. Cost-of-living adjustments Ÿ C. Merit pay D. Incentives 15. Which form of pay is likely to be least expensive for employers? Ÿ A. Incentive B. Merit pay C. Cost-of-living adjustments D. Base pay 16. Employees who want to be sure their good performance will be rewarded will prefer A. merit pay. B. team incentives. Ÿ C. individual incentives. D. across-the-board pay increases. 17. Variable pay may also be called A. exempt B. non-exempt C. stock options Ÿ D. incentives 18. Which of the following is the largest component in an executive pay package?
A. Base pay Ÿ B. Stock options C. Merit pay D. Perks 19. A company that says its relatively low starting pay will be offset by larger future pay increases is using the concept of _____. Ÿ A. present-value B. merit pay C. incentives D. deferred benefits 20. All of the following have direct financial costs for an employer except: A. benefits Ÿ B. relational returns C. work-life balance D. income protection 21. Which of the following is not an objective in the pay model? A. Fairness B. Compliance C. Efficiency Ÿ D. Productivity 22. Costs are to management as _____ is to alignment. Ÿ A. work analysis B. communication C. surveys D. merit guidelines 23. Market definitions are to competitiveness as performance based is to _____. A. alignment B. compliance C. efficiency Ÿ D. contributions 24. Which of the following is not a policy in the pay model? Ÿ A. Fairness B. Competitiveness C. Contributions D. Alignment 25. Performance, quality, customers, stockholders and costs are components of which of the objectives of the pay model? A. Fairness B. Compliance Ÿ C. Efficiency D. Competitiveness 26. _____ implies that the way a pay decision is made may be as important to employees as the results of that decision.
Ÿ A. Fairness B. Compliance C. Efficiency D. Competitiveness 27. _____ refers to comparisons among jobs or skills inside a single organization. A. External competitiveness Ÿ B. Internal alignment C. Pay structure D. Equitable contributions 28. Which of the following policy choices has the greatest effect on employees' decisions to stay with the organization and to seek additional training and responsibilities? A. External competitiveness B. Employee contributions Ÿ C. Internal alignment D. Job evaluation 29. Managers seek internal alignment within their organization by: A. matching competitors' pay rates. B. following FLSA guidelines. C. using fair merit increases. Ÿ D. paying on the basis of similarities among jobs. 30. Compensation policy choices affecting pay level are most closely associated with _____. A. internal alignment Ÿ B. external competitiveness C. contributions D. management 31. Sam's Club matches the pay of other similar businesses, Whole Foods uses base pay and team incentives and Medtronic emphasizes work and life balance. These illustrate _____ pay policy choices. A. cost control B. internal alignment C. contributions Ÿ D. external competitiveness 32. Choices among pay for performance, flat rate pay and profit sharing are examples of _____ policy decisions. A. internal alignment B. efficiency Ÿ C. employee contributions D. management 33. Which of the following decisions directly affects employees' attitudes and work behaviors? Ÿ A. Employee contributions B. Internal alignment
C. External competitiveness D. Management 34. According to the text, which of the following decisions should be made jointly? A. Internal alignment and Management. Ÿ B. External competitiveness and Employee contribution C. Employee contribution and Internal alignment D. Management and External competitiveness 35. Which of the following decisions answers the "So What" question? A. Internal alignment B. Employee contributions C. External competitiveness Ÿ D. Management 36. If an organization allows workers to get rewards such as stock options due to illegal and unethical means, this reflects a failure of which policy choice? A. Internal alignment B. Efficiency C. Employee contributions Ÿ D. Management 37. You are an HR manager and your boss has told you to find the best way to raise job performance. After some research you find that _____ produce(s) the largest and most reliable performance increases. A. high base pay B. great benefits that attract and retain workers C. a combination of goal setting and job enrichment Ÿ D. monetary incentives 38. Which of the following is not a guideline for determining if research has value? A. Is the research useful B. Can alternative explanations be ruled out Ÿ C. Was the research conducted by Ph D researchers D. Is correlation separated from causation 39. A measure of how changes in one variable are related to changes in another variable is: A. standard deviation B. analysis of variance Ÿ C. correlation coefficient D. regression analysis 40. The best way to establish _____ is to account for competing explanations, either statistically or through control groups. Ÿ A. causation B. profitability C. correlation coefficient D. internal alignment
1. A merit increase is best described as: Ÿ A. an incentive that recognizes past performance. B. an inducement for achieving long-term organizational objectives. C. a one-time reward for past performance that does not increase base pay. D. an increase that is exempt from the regulations of the Canada Labour Code. E. a promise of future payments. 2. A comparison of earnings of women with those of men highlights what many consider: Ÿ A. inequities in pay decisions. B. external pay equity. C. equity theory of motivation. D. comparative wage principle. E. supplemental pay benefit. 3. The following are forms of pay except: A. base wage. B. incentives. C. merit. D. benefits. Ÿ E. administration. 4. Pay for executives is supposed to be tied to the: A. external pay equity theory. Ÿ B. financial performance of the company. C. cost of living index. D. industry-wide norm. E. piece-rate production plan. 5. Compensation research can be evaluated on the basis of its: A. cost effectiveness. B. contingency. C. performance. D. alternative explanations. Ÿ E. quality and relevance. 6. The point of looking at the definition of compensation in other languages, especially in Japan, is to understand that compensation takes care of: A. stakeholders of the business. B. stockholder returns. Ÿ C. employees' financial needs. D. suppliers in the chain. E. customers in the target market. 7. All of the following are characteristics of base pay except: Ÿ A. pay that reflects past work behaviours and accomplishments. B. pay that reflects the value of work itself. C. basic work compensation that an employee pays for work performed. D. pay calculated at an hourly rate. E. a bonus paid for a special holiday. 8. Incentives are: A. rewards that induces performance.
B. rewards of past work behaviours and accomplishments. C. long-term and short-term. Ÿ D. rewards that induces performance and long-term and short-term. E. paid as a flat rate. 9. Which of the following is NOT included in the definition of compensation? A. Paid vacation B. Health insurance Ÿ C. Promotions D. Cost of living adjustments E. Merit pay 10. Internal alignment may be achieved by: A. making cost of living adjustments. B. matching competitors' wage rates. C. paying below-market base wages but offering training and rapid promotion. D. matching outside job offers employees receive from other organizations. Ÿ E. paying on the basis of similarities among jobs within a firm. 11. Which of the following relationships within a pay system is accurate? Ÿ A. Compensation objectives shape pay policies. B. Pay policies determine the objectives of the pay system. C. Organization strategies determine employee needs. D. Pay policies form the compensation strategy of the organization. E. External competitiveness is the sole determinant of employee pay. 12. An incentive payment: A. will increase base wages in future years. B. is nontaxable and therefore highly preferred by employees. C. may be made at the beginning of a quarter for expected performance during that quarter. Ÿ D. can be based on individual or group performance. E. all of the answers are correct. 13. The most effective compensation mix for an organization is: A. increasing base wage with seniority. Ÿ B. there is no single mix which is best for all organizations. C. maintaining or decreasing base wage as benefits increase. D. roughly equal distribution between financial and non-financial compensation. E. significantly higher financial compensation, relative to non-financial compensation. 14. Programs that help employees better integrate their work and life responsibilities include time away from work, access to services to meet specific needs, and flexible work arrangements. These programs are referred to as: A. long-term incentives. B. merit pay. C. total earnings opportunities. Ÿ D. work/life focus benefits. E. income protection benefits. 15. Which policies form the building blocks, the foundation on which pay systems are
built? A. Internal alignment B. External competitiveness C. Employee contributions D. Administration of the pay system Ÿ E. All of the answers are correct. 16. Telling students they must answer half the questions in this exam correctly in order to pass this course is similar to which form of compensation? A. Merit pay B. Base wage C. Compensation Ÿ D. Incentives E. Benefits 17. External competitiveness refers to: A. employee contributions. B. the relative importance of jobs within an employer. C. internal consistency. Ÿ D. compensation paid by competitors. E. inflationary pressure. 18. The compensation objective of compliance refers to: A. controlling labour costs. B. complying with common accounting procedures. C. complying with product quality standards. Ÿ D. complying with relevant regulations and laws. E. comparing the total wage bill to the estimated wage bills of competitors. 19. Stockholders generally pay particular attention to what aspect of pay? Ÿ A. Executive compensation B. Internal consistency C. Benefits D. Administration E. Base wage 20. The pay policy that is typically established through a sequence that starts with the analysis of the work done and the people needed to do it is called a (an): A. performance-based increase. B. incentive plan. C. employee stock option. Ÿ D. internal alignment. E. external competitiveness. 21. The basic cash compensation that an employer pays for the work performed is called: A. merit pay. Ÿ B. base wage. C. compensation. D. incentives. E. None of the answers are correct.
22. The relative output for each dollar of pay is called: A. performance-based pay. B. supplemental pay benefits. Ÿ C. productivity. D. job evaluation. E. performance appraisal. 23. Employees may: A. vary in their preferences for forms of pay. B. also be stockholders. C. weight the psychological returns of work as equal to the financial returns. D. view pay as a stream of earnings. Ÿ E. All of the answers are correct. 24. When assessing the worth of a study related to compensation theory it is important to ask: A. " Does the research measure anything useful?" B. "Does the study separate correlation from causation?" C. "Are there alternative explanations?" D. "Does the research measure anything useful?" and "Are there alternative explanations?" . Ÿ E. All of the answers are correct. 25. Which pay form would best be described as a return, rather than a reward? Ÿ A. Base wage B. Merit pay C. Short term incentive D. Sales commission E. Promotion CH2
1. "Supporting promotional growth opportunities" is an example of which of the following? A. Objectives Ÿ B. Internal alignment C. Externally competitive D. Employee contributions 2. "Putting some skin in the game" refers to: A. employees paid entirely on commission B. being paid as a contract vs. a regular employee Ÿ C. below market base pay with stock ownership D. above market base pay with low benefits 3. A compensation system that pays employees such that "some skin is in the game" means that Ÿ A. a portion of employee pay is at risk B. employers risk high labor costs C. level of base pay is below competitors
D. base pay is low while benefits are generous 4. In which of the following country would it be most difficult for someone to move from one employer to another? A. U.S. B. Korea Ÿ C. Germany D. Canada 5. At the corporate level, a strategic compensation perspective addresses the question: Ÿ A. What business should we be in? B. What is our desired return on assets? C. How can our total compensation help gain competitive advantage to achieve organization success? D. How can job analysis help us select the most appropriate certain compensation technique(s) for our organization? 6. What level of strategy is the question "how do we gain competitive advantage"? A. Corporate Ÿ B. Business unit C. HR D. Departmental 7. The social, competitive and regulatory environment factors are most important for which type of strategy? A. Corporate B. Business unit C. HR Ÿ D. Strategic compensation 8. Which of the following relationships within a pay system is accurate? Ÿ A. Compensation objectives shape pay policies. B. Pay policies determine the objectives of the pay system. C. Organization strategies determine employee pay needs. D. Pay policies form the compensation strategy of the organization. 9. A focus on competitor's costs is most closely associated with a _____ strategy. A. innovator B. customer-focused Ÿ C. cost-cutter D. differentiated 10. A compensation system using market-based pay is most likely to be part of a _____ strategy. Ÿ A. innovator B. cost-cutter C. global D. customer-focused 11. Flexible-generic job descriptions would most likely be used with a _____ strategy. Ÿ A. innovator B. customer-focused
C. differentiated D. cost-cutter 12. A compensation system focusing on system control and work specifications is most closely associated with _____ strategy. A. global B. customer-focused Ÿ C. cost-cutter D. differentiated 13. Whole Foods' policy of holding executive salaries to no more than 14 times average pay of full-time employees is an example of which strategic pay decision? A. External competitiveness B. Employee contributions C. Management Ÿ D. Internal alignment 14. Decisions regarding what forms compensation should be are part of _____. A. internal alignment Ÿ B. external competitiveness C. employee contributions D. management 15. The choice to communicate and make open an organization's pay system to employees is an example of which strategic choice? A. Internal alignment B. External competitiveness C. Employee contributions Ÿ D. Management 16. The decision to base pay increases on individual or group performance is made within the _____ strategic compensation choices. A. internal alignment B. external competitiveness Ÿ C. employee contributions D. management 17. A book listing the previous year's pay of all employees is part of Whole Foods "Nosecrets" philosophy. This is an example of which strategic compensation choice? A. Internal alignment B. External competitiveness C. Employee contributions Ÿ D. Management 18. Whole Foods' decision to seek and engage employees who are going to help the company make money is an example of which strategic pay decisions? Ÿ A. Objectives
B. Employee contributions C. Internal alignment D. Management 19. The second step of developing a total compensation strategy is to: A. implement strategy. B. assess total compensation implications. C. estimate the cost of the strategy. Ÿ D. map a total compensation strategy. 20. "Choosing techniques to fit strategy" is a part of which step in developing a total compensation system? A. Reassess Ÿ B. Implement strategy C. Map a total compensation strategy D. Assess total compensation implications 21. Examination of employee and union needs and the social and political context is a part of _____ step in formulating a total compensation strategy. Ÿ A. assess total compensation implications B. implement strategy C. mapping strategy D. assessing business needs 22. Which of the following is the correct order of the steps in formulating a total compensation strategy? A. Assess total compensation strategy, implement strategy, map a total compensation strategy, reassess Ÿ B. Assess total compensation strategy, map a total compensation strategy, implement strategy, reassess C. Map a total compensation strategy, implement strategy, assess total compensation strategy, reassess D. Map a total compensation strategy, assess total compensation strategy, implement strategy, reassess 23. "To maintain good citizenship as a company" and "To make a fair profit on current operations" are examples of _____. Ÿ A. values B. mission C. goals D. operating principles 24. Among unconventional benefits, U. S. workers in the Hudson's survey rated _____ as their most preferred. A. more supplemental insurance B. more job training Ÿ C. a more flexible work schedule D. more personal days and family leave 25. Which of the following statements regarding allowing employees choice in their pay mix is not true?
A. A wide-range of choices is difficult to manage Ÿ B. It provides an employer a clear competitive advantage C. Unlimited choice is difficult to design D. Too many choices can confuse people 26. Union preferences is a major factor in _____ of a total compensation strategy. A. implementing B. reassessing Ÿ C. assessing implications D. mapping 27. In mapping a total compensation strategy, the question of how is compensation in the overall HR strategy is part of _____. Ÿ A. objectives B. internal alignment C. external competitiveness D. management 28. The issue of how much and what forms of pay are our competitors using is part of which objective of total compensation strategy? A. Objectives B. Internal alignment Ÿ C. External competitiveness D. Management 29. The role non-HR managers play in making pay decisions is called _____. Ÿ A. ownership B. transparency C. technology D. decentralized decision-making 30. Issues of transparency, technology, and choice are examples of choices related to the _____ strategy choice of total compensation. A. objectives Ÿ B. management C. employee contributions D. internal alignment 31. Career growth, hierarchy and flexible design are examples of choices related to the _____ strategy choice of total compensation. A. objectives Ÿ B. internal alignment C. external competitiveness D. employee contributions 32. A strategy map contains strategies about all but which of the following? A. External competitiveness B. Management
Ÿ C. HR alignment D. Employee contributions 33. Which of the following is not a test of whether a pay strategy is a source of competitive advantage? A. Alignment with business strategy Ÿ B. Cost effectiveness C. Differentiation D. Adding value 34. Which of the following is not one of the tests to determine if a pay strategy is a source of competitive advantage? A. Alignment of the pay system with the organization's business strategy B. Differentiation of an organization's strategy from its competitors C. Internal alignment of the pay strategy with the organization's strategy Ÿ D. External competitiveness of the pay system 35. Which of the following is the easiest test to pass? Ÿ A. Alignment B. Differentiation C. Integration D. Adding value 36. The alignment test A. is difficult to imitate. B. is the most difficult test. Ÿ C. helps ensure passing the differentiation test. D. becomes difficult if the differentiation test is not clear. 37. Trying to measure an ROI for any compensation strategy implies that A. it is possible to align and differentiate and still fail to add value. Ÿ B. people are "human capital," similar to other factors of production. C. adding value is the most difficulty test. D. value created as a result of costs is difficult to specify. 38. _____ is a "best practice". A. Smaller internal pay differences B. Larger internal pay differences Ÿ C. Both smaller and larger internal pay differences D. Neither smaller nor larger internal pay differences 39. Research investigating high-performance workplaces found that performance-based pay _____ when combined with other high performance practices. Ÿ A. improves attitudes and behaviors B. shows large productivity improvements C. reduces labor costs D. has little effect on quality 40. When organization performance declines, A. a virtuous circle may be created. Ÿ B. performance-based pay plans do not pay off.
C. managers will change the pay practices. D. employees will work harder to improve performance. 1. By asking employees to "put some skin in the game," Microsoft is seeking: Ÿ A. employees to accept less base pay to join a company whose stock options were increasing in worth exponentially. B. to hire on the basis of skin colour. C. to reassure employees of their job security. D. employees who will be compatible with coworkers. E. to emphasize its base pay. 2. Contingency refers to: A. lawyers' fees in any tobacco settlement. B. external labour markets in Japan. Ÿ C. the alignment of the compensation system to the organization's strategy. D. paying whatever the market dictates. E. compatibility among different forms of pay. 3. A company that decides to compete on the basis of innovation: A. will emphasize cost control. B. will probably pay on the basis of productivity increases. C. may use detailed job descriptions. Ÿ D. wants to shorten the time it takes to develop a new product and get it to customers. E. will use a piece rate pay system. 4. A strategic compensation perspective addresses the question: A. What business should we be in? B. What is our desired return on assets? C. What kind of job evaluation system should we use? D. How many people should we hire this year? Ÿ E. How can our total compensation help gain competitive advantage? 5. The strategic rationale for Whole Foods offering a compensation program to all employees, is: Ÿ A. to gain employee loyalty. B. to match what competitors are doing. C. to offset the hazardous nature of the work. D. to hold down costs. E. to boost turnover. 6. Deciding how much employees should be told about how their pay is determined is an issue of A. internal consistency. B. external competitiveness. C. recognition of contributors. Ÿ D. administration. E. articulation. 7. An emergent strategy A. is more difficult for competitors to imitate. Ÿ B. is inferred from the company's pattern of decisions.
C. provides more flexibility than an articulated strategy. D. is easily communicated to decision makers at all levels. E. All of the answers are correct. 8. In Europe and other countries: A. pay systems communicate need for change in the organization. B. unions play a lesser role in pay determination than in Canada. C. pay systems tend to be based more on markets and performance than in Canada. D. pay plays a supporting role in the overall HR strategy. Ÿ E. None of the answers are correct. 9. The compensation strategy Ÿ A. is revealed in the pattern of decisions on strategic issues. B. is secondary to the training strategy. C. includes all the decisions on pay techniques. D. tends to be the same for all organizations in an industry. E. is revised on an annual basis. 10. The best pay practices will allow the employer to gain preferential access to superior human resource: Ÿ A. talent and competencies. B. policies and procedures. C. labour unions and management. D. teams and bargaining unit members. E. affirmative action and discriminatory practices. 11. A high commitment strategy combines A. low base pay but high bonuses. B. high base pay but low employment security. C. high turnover with paying whatever the external market dictates. Ÿ D. high base pay and promotions from within the organization. E. low base pay but high employment security. 12. Pay strategy research shows that: A. companies of the same size tend to pay the same. Ÿ B. how a bonus system is structured is related to a firm's financial performance. C. in small firms, compensation affects labour costs more than it affects employee behaviour. D. compensation affects employee behaviour more than it does costs. E. employees prefer health insurance to higher base wages. 13. The need of a strategy for an organization is to develop a sound and equitable: Ÿ A. compensation strategy. B. labour agreement. C. discriminatory practice. D. customer profile. E. manipulation policy. 14. Which of the following is not an option within the "high commitment" view of best pay practices? A. Selectivity in recruiting B. Guaranteed employment security Ÿ C. Risk sharing partnership
D. Employee ownership E. None of the answers are correct. 15. Those who believe that a set of best practices exists independent of circumstances tend to subscribe to the: A. preferential access perspective. B. socio-economic environment. C. implicit contract partnership. Ÿ D. resource-based perspective. E. competitive advantage approach. 16. An implicit contract: A. is legally unenforceable. B. involves unwritten understandings. C. includes reciprocal obligations. D. includes reciprocal returns. Ÿ E. All of the answers are correct. 17. The business strategy that stresses satisfying clients and bases employee pay on how well they do this is a (an): A. market-driven strategy. Ÿ B. customer-focused strategy. C. affirmative action policy. D. human resource plan. E. merit review rule. 18. The fundamental strategic choice of compensation is decided upon at the: A. supervisory level. B. first-line management level. C. stockholder level. Ÿ D. corporate level. E. middle-management level. 19. The competitive dynamics focus on such business environmental factors as: A. changing customer needs. B. competitors' actions. C. changing labour market conditions. D. changing regulations. Ÿ E. All of the answers are correct. 20. Which one of the following is not one of the five aspects of strategic compensation discussed in the textbook? A. Balancing consistency Ÿ B. Pay techniques C. Competitiveness D. Recognizing individual contributions E. Administering the system fairly 21. High performance systems generally include these features: A. high skill/knowledge requirements B. work designed so that employees have discretion and opportunities to collaborate with
others C. continue to learn training and development D. performance-based pay systems Ÿ E. All of the answers are correct 22. A pay strategy that provides competitive advantage: Ÿ A. will be difficult for employers to imitate. B. specifies low base pay and high job security. C. will not change even if the company changes business directions. D. will be the same in all countries in which the organization operates. E. will dictate promotions from within the organization. 23. Which of the following refers to how an employer positions its pay relative to what competitors are paying? Ÿ A. External consistency B. Internal consistency C. External competitiveness D. Internal competitiveness E. Administration 24. Internal consistency refers primarily to: A. the value of the work of one individual compared to the value of the work of another individual. B. the desire of management to pay above market salaries. Ÿ C. the pay relationships among jobs within one employer. D. the pay relationships of all jobs within the same industry. E. pay relationships among the violinists in two orchestras. 25. The objective of a pay system is to A. help the organization achieve financial success. B. help the employees connect their behaviour with the success of the organization. C. comply with federal and provincial pay regulations. D. help the organization work more efficiently. Ÿ E. All of the answers are correct. CH 3
1. The parable of the vineyard owner and compensation paid to the laborers illustrated: A. paying workers according to their productivity. B. pay based upon the content of the job. C. pay based upon hours of work. Ÿ D. ignorance of the owner towards the content of work. 2. Common bases for modern pay structures include all but which of the following? A. Content of the work B. Skills and knowledge required to perform the work Ÿ C. Seniority and experience D. Relative value for achieving organizational objectives 3. _____ should support the organization strategy, support the work flow and motivate behavior toward organization objectives.
A. The job evaluation process B. Strategic compensation objectives C. Employee contributions Ÿ D. The pay structure 4. In the strategic approach to pay, internal alignment is the _____ issue to be decided. A. first Ÿ B. second C. third D. fourth 5. Which of the following is not part of the description of a pay structure? A. Pay differentials B. Criteria determining pay differences Ÿ C. Performance pay D. Number of levels 6. Which of the following is an intension of differentials? A. Motivating people to strive for promotion to a higher-paying level B. Motivating workers to seek additional training C. Making workers feel it is fair that the next highest job is paid more than their job Ÿ D. Motivating worker by productivity incentives 7. When employees can see the relationships between their work, the work of others and the organization's objectives, this is called A. procedural justice. Ÿ B. line-of-sight. C. goal congruence. D. path-goal-congruence. 8. The most common bases for determining internal structures are: Ÿ A. work content and its value B. seniority and experience C. use value and exchange value D. pay surveys and job evaluation 9. Content refers to the A. worth of the work. Ÿ B. work performed in a job and how it gets done. C. relative contribution to the organization objectives. D. different pay level policies. 10. A pay structure based upon the relative contribution of skills, tasks and responsibilities to the organization's goals is called the _____ approach. A. content Ÿ B. value C. job analysis D. job evaluation 11. The pay for the job of accountant in London, Los Angeles and Berlin is likely to be different due to
A. use value. B. currency exchange rates. C. demand and supply. Ÿ D. exchange value. 12. Most job structures are best described as A. job-based. B. person-based. Ÿ C. both person- and job-based. D. competency based. 13. Organization factors that shape internal pay structures include all but _____. A. technology B. cost implications C. HR policy Ÿ D. economic pressures 14. Marginal productivity theory argues that employers pay _______. Ÿ A. use value B. exchange value C. market value D. capital value 15. Which of the following is not a factor in defining equal work in the Equal Pay Act? A. Skill B. Effort Ÿ C. Knowledge D. Working conditions 16. Unions prefer which of the following? Ÿ A. Small pay differences between jobs and seniority-based promotions B. Large pay differences between jobs and seniority-based promotions C. Small pay differences between jobs and performance-based promotions D. Equal pay raises for employees 17. The modern concept of a "living wage" is most similar to _____. A. marginal productivity wage B. exchange value Ÿ C. just wage doctrine D. bourse 18. Which of the following is not a component of human capital? Ÿ A. Seniority level B. Experience C. Knowledge D. Education 19. Pay for temporary workers is based upon Ÿ A. the internal structure of their home employer. B. the internal structure of the temporary workplace. C. strict legislative requirements. D. education and experience. 20. Which of the following is not one of the changes in organization design that may affect pay structures?
A. Outsourcing Ÿ B. Dual careers C. Delayering D. Temporary workers 21. The number of job and pay levels in an organization is an example of _____. A. organization strategy B. human capital Ÿ C. human resource policies D. work design 22. Which of the following concepts best explains why newly hired workers may be paid more than longer tenure workers performing very similar work? A. Marginal revenue product B. Supply and demand C. Exchange value Ÿ D. Internal labor market 23. Which of the following pay structure procedures would not increase perceptions of pay fairness? A. Consistency across all employees B. Use of accurate data Ÿ C. Consultants develop the pay structure D. Including appeals procedures 24. Bill says, "I don't trust the way the company determines pay rates in my department." Bill is most concerned about _____. Ÿ A. procedural justice B. distributive justice C. internal equity D. external equity 25. Suzanne says, "I don't like it that those jobs that are a lot like mine pay more than my job." Suzanne is expressing concern about _____. A. external equity B. exchange value C. procedural justice Ÿ D. distributive justice 26. If a manager wants employees to accept the organization's pay structure, the best strategy is to A. pay everyone the same B. show them what competitors pay Ÿ C. explain to them how pay was determined D. tell them the pay level is the most the company can pay 27. Which of the following is not a characteristic of an aligned pay structure? A. Supports the way work gets done B. Fits the organization's business strategy C. Is fair to employees
Ÿ D. Complies with the Fair Labor Standards Act 28. The well-defined jobs at McDonald's and their small differences in pay are an example of a(n) _____ internal pay structure. Ÿ A. closely tailored B. loosely coupled C. very competitive D. egalitarian 29. Organizations in a turbulent and unpredictable environment requiring flexibility in jobs and work processes are likely to be more successful with a(n) _____ internal pay structure. A. egalitarian B. bureaucratic Ÿ C. loosely coupled D. closely tailored 30. Egalitarian pay structures have all but which of the following characteristics? A. Few levels B. Small differentials C. Supports equal treatment Ÿ D. Supports individual performers 31. Hierarchical pay structures have all but which of the following characteristics? A. Supports a close fit with the organization Ÿ B. Supports cooperation C. Many levels D. Is based upon the job or person 32. A problem faced by some organizations using an egalitarian pay structure is _____. Ÿ A. difficulty in external recruitment B. maintaining cooperation among employees C. perception of excessive CEO pay D. difficulty in team work 33. Which of the following is not a comparison employees use to judge the fairness of their organization's pay structure? A. Comparing jobs similar to their own B. Comparing their pay to external pay levels Ÿ C. Comparing their pay raises to others in their organization D. Comparing their job's pay to other jobs in their organization 34. Which theory predicts individual performance will be maximized when the pay differentials between job levels is large? Ÿ A. Tournament B. Equity C. Marginal productivity D. Reinforcement theory 35. When cooperation is important for successful organization performance, the best form
of pay is _____. A. tournament Ÿ B. egalitarian C. hierarchical D. institutional 36. There is evidence that a relatively poor performing team member's performance will improve under a(n) _____ pay structure. Ÿ A. egalitarian B. hierarchical C. bureaucratic D. loosely-coupled 37. Which of the following is not true? A. Large pay differences in a top management team are associated with high turnover. B. Egalitarian structures are a better fit for executive groups that need to work closely as a team. C. Large raises with a promotion increases effort and reduces absenteeism. Ÿ D. Tournament theory raises performance of the top performers but reduces motivation of poorer performers. 38. The institutional model _____. A. is adopted by high performing, innovative organization Ÿ B. refers to firms that copy innovative practices adopted by other organizations C. is another name for the bureaucratic model D. is a hybrid of the hierarchical and egalitarian model 39. In firefighting and rescue squads and global software design teams, a(n) _____ structure is associated with higher performance. A. hierarchical B. institutional Ÿ C. egalitarian D. tournament 40. Which of the following are related to greater performance when the work flow depends on individual contributors? A. Egalitarian Ÿ B. Hierarchical C. Tournament D. Institutional 1. The following are criteria in a pay structure except: A. job content. B. knowledge, skills, and abilities required to perform the work. C. performance results of work. Ÿ D. job analysis.
E. work flow. 2. What depicts organizations as simply following patterns exhibited by other organizations? A. Internal labour markets B. Just wage doctrine Ÿ C. Institutional theory D. Tradition E. Legal requirements. 3. Which of the following relationship factors influence internally aligned pay structures? A. Supporting the workflow B. Fairness to employees C. Directing employee behaviour toward organization objectives D. Different jobs inside an organization Ÿ E. All of the answers are correct. 4. Internal alignment refers primarily to: A. the value of the work of one individual compared to the value of the work of another individual. B. the desire of management to pay above market salaries. Ÿ C. the pay relationships among jobs within one employer. D. the pay relationships of all jobs within the same industry. E. the pay relationships in a geographic region. 5. An egalitarian pay structure: Ÿ A. implies a belief that pay differences among employees should be minimized. B. implies a belief that the persons with the most seniority should be paid more than new hires hired for similar positions. C. eliminates the problem of pay compression. D. instills a highly competitive spirit among co-workers to try to top the performance of the people they work with. E. is less costly than an hierarchical structure. 6. Pay structure can be described on these dimensions: I. Number of levels. II. Pay differentials among levels. III. The criteria used to support the structure. A. I, II B. I, III C. II, III Ÿ D. All of the answers are correct. E. None of the answers are correct. 7. Both external and organizational factors are combined in the notion of: Ÿ A. internal labour markets. B. external labour markets. C. employee labour markets. D. employer labour markets. E. marginal labour markets. 8. The criteria needed to develop a pay structure include all of the following except:
A. job content. B. knowledge, skill and ability requirements. C. performance results of work. Ÿ D. salary history of person you wish to hire. E. how the work is organized. 9. The major factors that shape internal structures are: A. boundary-spanning roles of management. B. labour unions. C. job enrichment programs. Ÿ D. external and organization factors. E. re-engineering and human resource planning tools. 10. The process by which goods and services are created and delivered to the customer is: Ÿ A. work flow. B. job evaluation. C. performance appraisal. D. job analysis. E. job enrichment. 11. Whatever wage the employer and the employee agree upon is called: A. pay equity theory. Ÿ B. exchange value. C. compensation-based pay. D. pay-for-performance. E. expectancy theory motivation. 12. Internal factors that will influence compensation programs of employers would include the following except: A. unions. Ÿ B. government regulations. C. stockholders. D. political groups. 13. The mental programming for processing information that people share in common is: A. recruiting. B. human resource planning. Ÿ C. organization culture. D. selection. E. pay equity theory. 14. The education, experience, knowledge, abilities and skills that people possessregarded as a major influence on internal structures-is: A. capital formation. B. capital goods. C. labour intensity. D. cultural diversity. Ÿ E. human capital. 15. Which is an important factor influencing employees' perceptions of pay equity? A. Qualifications required doing the job.
B. Tasks performed on the job. C. Value of the product. Ÿ D. Employees judge equity on the basis of comparisons between the work, qualifications, and pay for their own jobs versus the same for other jobs. E. The number of pay levels. 16. A hierarchical pay structure will encourage employees: Ÿ A. to accept a promotion which requires developing new skills. B. to offer customers excellent service. C. to search for other jobs. D. to be committed to the organization objectives. E. to control costs. 17. The process used in producing goods and services and that influences the organizational design, its functional specialties, work teams, and departments is the degree of: A. organizational culture. Ÿ B. technology. C. capital formation. D. wage compensation. E. pay equity theory. 18. Internal alignment: A. focuses on individual employees. B. takes performance into account. Ÿ C. addresses the relationships inside the organization. D. plays a greater role in setting wages for entry level jobs than do external comparisons. E. reflects the organization's financial position. 19. Process by which goods and services are delivered to the customer is known as: A. pay structure. B. salary administration. C. line-of-sight. Ÿ D. workflow. E. none of the answers are correct 20. According to notion of internal labour markets, pay for non-entry jobs is heavily influenced by: A. availability of skills in the external market. B. the wage paid at entry level. Ÿ C. internal factors such as the organization's strategy, technology, human capital required and other HR systems. D. tenure with the organization. E. wages paid by other organizations for similar jobs. 21. Which of the following is not a dimension used to describe pay structures? A. The number of levels Ÿ B. Validity of the structure C. Criteria used to support the structure D. Pay differentials among levels E. None of the answers are correct.
22. To describe the distribution of pay, researchers use a statistic called the: Ÿ A. gini coefficient. B. equity theory of motivation. C. expectancy theory of motivation. D. internal equity theory. E. external equity theory. 23. Internal pay structures in Japan tend to emphasize seniority and "waiting for your turn." This is an example of: A. the economic condition in which the organization operates. B. the technology of an organization. Ÿ C. societal judgments. D. the characteristics of the work involved. E. None of the answers are correct. 24. Setting greater pay differentials at the top of the pay structure is based on: A. marginal productivity. B. institutional theory. Ÿ C. tournament theory. D. equity theory. E. None of the answers are correct. CH 4
1. The process of collecting information that identifies similarities and differences among jobs is _____. A. job evaluation Ÿ B. job analysis C. observation D. work structure analysis 2. Which of the following is not part of the process of creating an internal job structure? A. Collect and summarize work content information B. Determine what to value C. Quantify the relative value Ÿ D. Assess the cost of the product or service 3. In the process of creating an internal structure, "assess relative value" is done after _____. Ÿ A. determining what to value B. collecting and summarizing job content information C. translate into structure D. job evaluation 4. The first major decision in job analysis is _____. A. how to collect information B. who to involve C. what information is needed Ÿ D. why perform job analysis 5. Which of the following is an ordering of jobs based on their content or relative value?
A. Job analysis B. Job description Ÿ C. Job structure D. Job evaluation 6. Job analysis is important for both managers and employees because it is Ÿ A. the basis for a work-related rationale for pay differences. B. an important result of the job evaluation process. C. required under the Fair Labor Standards Act. D. required for performance appraisal. 7. A specific statement of what a worker does on a job is a _____. A. task dimension Ÿ B. task C. job element D. None of these 8. "Responsibility for ensuring that accurate information is provided to customers" is an example of a _____. A. task B. task statement Ÿ C. task dimension D. job 9. A group of tasks performed by one person is a(n) _____. Ÿ A. position B. job C. family D. incumbent 10. A set of identical positions is a(n) _____. A. job family B. occupation C. job group Ÿ D. job 11. According to government procedures of the job analysis process, the first interview should be conducted with the _____. Ÿ A. incumbent's supervisor B. incumbent C. HR manager D. incumbent's co-workers 12. Government job analysis procedures recommend interviewing A. the best performing employees. B. long tenure employees. Ÿ C. the typical employee. D. workers just completing the probationary period. 13. The verification step of the government job analysis method is always conducted with _____. A. the HR manager Ÿ B. all interviewees
C. the supervisor or manager D. high-performing employees 14. Which of the following would not be included in job identification information in a job analysis? A. Job title B. Department in which job is located C. Number of people who hold job Ÿ D. Current pay level 15. Typical data collected for job analysis would include all but which of the following? A. job performance criteria B. relationships with subordinates Ÿ C. incumbent performance level D. conflicting work demands 16. The heart of job analysis is _____ data. Ÿ A. job content B. job identification C. employee knowledge and skills D. tasks and experience 17. Which of the following is not true of task inventories? A. It describes actual tasks. Ÿ B. A task inventory can be used for many different jobs. C. It measures the purpose of tasks. D. It uses an objective rating format. 18. The Position Analysis Questionnaire analyzes jobs in terms of _____. A. job data B. duties and responsibilities C. job elements and tasks Ÿ D. employee data 19. The job analysis method that uses information input, work output, job context, and relationships with other persons is _____. A. task inventories Ÿ B. PAQ C. essential elements D. Job Tasks and Elements Inventory 20. Which of following item is a part of oral communication in the Position Analysis Questionnaire? A. Read technical publications to keep current in industry. B. Consult with co-workers to exchange ideas. Ÿ C. Routine information exchange job related. D. Attend industry standards meetings. 21. Potential problems with using one method of job analysis to collect information for most HR purposes include all but which of the following? A. It is very expensive B. Information collected may be too general
C. Information may not be accurate Ÿ D. It violates the Americans with Disabilities Act 22. "Essential elements" refers to A. tasks that are most important for job success. B. activities and duties rated critical by management. Ÿ C. tasks that cannot be reassigned to other workers. D. highly rated tasks in a task inventory. 23. Inclusion of essential elements in job descriptions is required by the Ÿ A. Americans With Disabilities Act B. Title VII of the 1964 Civil Rights Act C. Fair Labor Standards Act D. Equal Pay Act 24. ADA has led many employers to _____. A. use task inventory job analyses B. use the PAQ C. give special benefits to disabled employees Ÿ D. modify the format of their job descriptions 25. For which of the following types of HR decisions would the least detailed job information be required? A. Legal compliance B. Career paths Ÿ C. Compensation D. Staffing 26. The most common way to collect job information is _____. A. interview incumbents Ÿ B. ask incumbents to fill out a questionnaire C. ask supervisors to fill out a questionnaire D. the PAQ 27. The question, "Give an example of a particularly difficult time at work" is an example of which method of job analysis? Ÿ A. Job analysis questionnaire B. PAQ C. Task inventory D. On-line job survey 28. An advantage of conventional job analysis interviews and questionnaires is _____. Ÿ A. increased employee understanding of the process B. lower cost to the organization C. reduced subjectivity D. less time to complete the process 29. Conventional job analysis methods are being replaced by quantitative methods for all but which of the following reasons? Conventional methods are _____. A. open to bias and favoritism B. often subjective Ÿ C. not well-suited to small organizations
D. require more time consuming 30. Job analysis is typically conducted by _____. A. experienced job incumbents B. HR specialist Ÿ C. HR generalists and supervisors D. Supervisors and experienced workers 31. One of the best ways to increase employee acceptance for job analysis is to A. reduce costs. B. meet Fair Labor Standards Act requirements. C. increase reliability. Ÿ D. increase the involvement of employees. 32. When job analysis shows managers and employees disagree on parts of a job, what is the best answer? Ÿ A. Collect more data B. Use quantitative job analysis C. Refer the problem to the compensation committee D. Use an experienced compensation consultant 33. Traditional job analysis has been associated with _____ organizations. A. loosely-coupled Ÿ B. bureaucratic C. matrix D. global 34. _____ looks at how an organization does its work: activities pursued to accomplish specific objectives for specific customers. A. Job analysis B. Market analysis C. Job structure Ÿ D. Supply chain analysis 35. If several incumbents, supervisors and peers respond in similar ways to job analysis questionnaires, this suggests the results are _____. A. reliable Ÿ B. valid C. convergent D. acceptable 36. To be valid, acceptable, and useful, job information must be _____. A. authentic B. technical C. industry specific Ÿ D. up to date 37. Job analysis results are judged useful when they are _____. A. reliable and valid B. cost-effective and valid C. acceptable and reliable Ÿ D. reliable, valid and acceptable
38. "Does the analysis create an accurate perception of the work?" is a question answered by _____. A. reliability Ÿ B. validity C. acceptability D. usefulness 39. Which of the following is not a reason for using job analyses to build a pay structure? A. It provides work-related data. B. It provides reliable data. C. It provides accurate data. Ÿ D. It is superior to person-based analyses. 40. All of the following are likely consequences of inadequate detail in job analysis information except _____. Ÿ A. high labor costs B. unhappy employees C. lawsuits D. unhappy customers 1. A job analysis is considered "reliable" if: Ÿ A. the results of the analysis are the same regardless of who is involved in performing the analysis and what methods are used. B. the jobholder feels the results are an accurate analysis of the work. C. research proves the analysis to be an accurate portrait of the work. D. all judgmental assessments of the job have been eliminated. E. it leads the government to conclude that the system is fair. 2. Why is it important to involve the employees when conducting a job analysis? A. It is less expensive. B. It takes less time. Ÿ C. It may aid acceptance. D. It may be easier. E. They get to learn their jobs. 3. The systematic process of collecting relevant, work-related information related to the nature of a specific job refers to: A. job content. B. job evaluation. C. job structure. Ÿ D. job analysis. E. job descriptions. 4. A job description consists of: A. identifying the job. B. defining the job. C. describing the job. Ÿ D. All of the answers are correct. E. None of the answers are correct. 5. Job analysis provides the underlying information for:
A. calculating labour costs. Ÿ B. preparing job descriptions and evaluating. C. implementation of human resource plan. D. functional job evaluation. E. performance appraisal. 6. Historically, job analysis has been considered the cornerstone of: A. industrial relations. Ÿ B. personnel administration. C. human resource planning. D. job evaluation. E. employment equity. 7. The major issues in job analysis include: A. Why collect information? B. What information is needed? C. How to collect information? D. Who should be involved? Ÿ E. All of the answers are correct 8. Job analysis usually collects information about: Ÿ A. specific tasks or behaviours. B. tentative agreements. C. standing policy. D. standing plans E. performance appraisal. 9. Effective job analysis collects information categorized as "related to the": A. labour contract. B. collective bargaining process. C. standing plans. D. operating policy of stakeholders. Ÿ E. job and employee. 10. Data that involves the elemental tasks or units of work, emphasis on the purpose of each task is: A. human resource planning. B. job enlargement. C. recruiting. D. employment equity. Ÿ E. job content. 11. Job descriptions: A. are usually briefer for managerial jobs. B. require creative writing skills. C. should be written by someone outside the organization. D. include the name(s) of people currently holding the job. Ÿ E. clarify the relationship among similar or related jobs. 12. Advantages of quantitative job analyses such as (PAQ) over conventional methods (interviews and questionnaires) are: A. they are faster.
B. they may be more subjective. C. they can be collect more data. Ÿ D. they minimize the judgmental aspect of the analysis. E. they are cheaper. 13. What should a manager do if employees and their supervisors do not agree on what is part of the job? A. File a grievance B. Reengineer the job C. Revise organization structure Ÿ D. Collect more data E. Write job analysis 14. The knowledge, skills, and abilities required to adequately perform the tasks are the: A. job analyses. B. job evaluations. C. performance appraisals. D. positions analyses. Ÿ E. job specifications. 15. When job analysis is done for compensation purposes, data collected must focus on: A. type of training needed to perform the job effectively. Ÿ B. establishing job similarities and differences. C. the typical career path that encompasses this job. D. performance levels of job incumbents. E. task inventories. 16. The major limitation of conventional job analysis for compensation purposes is: A. it pertains only to managerial positions. B. it requires excessive lead time. C. its complexity. Ÿ D. difficulty in documenting its objectivity. E. the amount of employee involvement required. 17. The first decision in job analysis is: A. what type of collection method can the organization afford. B. what kind of information to collect. C. who would be the source of the information. D. how to ensure employee acceptance of results. Ÿ E. the purpose of the analysis. 18. In addition to defining and describing jobs, descriptions of managerial/professional jobs often include more detailed information on the: Ÿ A. nature of the job, its scope, and accountability. B. job evaluation. C. performance appraisal. D. job redesign. E. functional job analysis. 19. Internal structures: A. may be supplanted by other ways to achieve internal consistency.
Ÿ B. may be based on characteristics of jobs or characteristics of people. C. provide the criteria for designing jobs. D. are less complex in most European pay systems. E. are most commonly based on performance. 20. Obtaining consistent results regardless of the job analysis method used is a measure of: A. validity. B. flexibility. C. acceptability. Ÿ D. reliability. E. administration. 21. The major questions that need be asked when designing a job analysis are: A. for what purpose are we collecting job information. B. what information should be collected. C. what method should be used. D. how useful are the results. Ÿ E. All of the answers are correct. 22. The final step in the job analysis process is to: A. revise job specifications. B. enlarge the job. C. revise human resource plan. D. downsize the organization. Ÿ E. verify the accuracy of the resulting job descriptions. 23. Data such as job title and department in which the job is located is best described as data which: Ÿ A. identify the job. B. describe the job. C. define the job. D. identify the job and define the job. E. All of the answers are correct. 24. The principal sources of the data used in job analysis are: Ÿ A. jobholders and supervisors. B. supervisors "two levels above." C. subordinates and employees in other jobs. D. independent analysts. E. None of the answers are correct. 25. When determining the usefulness of job analysis, which of the following factors are considered? A. reliability B. validity C. acceptability D. costs Ÿ E. all of the answers are correct. CH 1
44. List the three basic objectives of a compensation system used in the model. Ÿ equity or fairness; efficiency; cost control 45. List two of the major forms of pay and give an example of it. Ÿ major forms are base (which includes merit, incentives) and benefits (which includes income protection, work/life focus, allowances)
