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T4 Questions and Answers

Question # 1

A particular organization wants to include in their compensation system some element of organizational performance linkage, while at the same time it wants to encourage employee commitment. In addition to base pay, which of the following would most likely be included in this compensation mix?


merit pay


piece rates


profit sharing


targeted incentives

Question # 2

Which of the following is the most important potential disadvantage of performance pay?


It increases the need for layoffs in poor economic conditions.


It does not fit well with high-involvement management.


It is mainly effective in small companies.


It does not pay off for some employers.

Question # 3

Which of the following steps is NOT considered part of formulating the compensation strategy?


determining actual dollar values for jobs and individual employees


determining the total level of compensation to provide


determining how each of the mix choices should be structured


determining the mix of compensation components

Question # 4

Company XYZ will be experiencing layoffs over the next several months. Which of the following is a best course for communicating this negative change?


Inform management-level employees, but wait to inform others until absolutely necessary.


Provide employees with a clear picture of the situation that the organization is facing.


Create multiple messages for different employees


Communicate the negative change using humor.

Question # 5

What is a consideration when using more than one presenter to communicate a message in a face-to-face channel?


Messages are best communicated by a single presenter


The last people to receive the message will get a shorter, less detailed message.


Audiences will react more favorably to presenters with louder voices


The message communicated is likely to vary, even if scripted.

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