Ch9 Verified Test Bank Pay-For-Performance The Evidence

1.

The motivation triangle includes _____. 
 

2.

The ability triangle includes _____. 
 

3.

When employee performance measures are ambiguous and vary from time to time, but the organization's performance is fairly stable over time, the most effective type of compensation is to offer _____. 
 

4.

When an organization's performance has frequent highs and lows, but individual performance is fairly stable, and performance measures are clear, the most effective compensation mix is to offer _____. 
 

5.

The corporate performance of Yellow Corp. is fairly stable. However, it is difficult to measure individual performance. In this case, the most effective compensation mix is to offer _____. 
 

6.

When employee performance is easily measured and the organization's performance is fairly stable over time, the most effective type of compensation is to offer _____. 
 

7.

When an organization's performance has regular and large swings and individual performance is unclear and hard to measure, the most effective compensation mix is to offer _____. 
 

8.

According to research, which of the following is NOT one of the most important factors for employees influencing their pay systems? 
 

9.

When identifying what is important to employees, which theory would be most useful? 
 

10.

_____ theory states that success-sharing plans will be motivating, whereas at-risk plans will be demotivating. 
 

11.

_____ is the value employees attach to the organization rewards offered for satisfactory job performance. 
 

12.

_____ is employees' beliefs that requisite job performance will be rewarded by the organization. 
 

13.

According to the _____ theory, relative pay is important as employees evaluate their pay-effort balance in comparison to other employees. 
 

14.

_____ theory argues that performance-based pay is the optimal compensation choice for complex jobs, where monitoring employee performance is difficult. 
 

15.

Which of the following theories states that people choose the behavior that leads to the greatest reward? 
 

16.

All of the following EXCEPT _____ require periodically re-earning the added pay. 
 

17.

Grabhouse Inc. is experiencing an increase in turnover rates of its top employees. Upon consulting with its managers for the reasons for this increase, Grabhouse finds that employees are uneasy with the current pay mix as it involves too many risky elements. In order to make its pay mix less risky, Grabhouse needs to: 
 

18.

_____ is an individual level form of performance pay. 
 

19.

Which of the following is NOT true? 
 

20.

A person with low self-esteem is likely to seek _____. 
 

21.

Which of the following is an example of the sorting effect in action? 
 

22.

Droppiece Inc. is a company that provides more performance-based pay and less base pay than its competitors. Who among the following is most likely to join Droppiece? 
 

23.

When pay is based on individual performance, turnover tends to be highest among _____. 
 

24.

When a company moves from an individual incentive plan to a group incentive plan, the company is most likely to experience _____. 
 

25.

Available evidence indicates managers believe the most important factor for pay increases is _____. 
 

26.

Company X pays for performance. Allan, an employee of the company, is not in favor of this reward system and, therefore, leaves Company X in search of another company with different rules for getting rewards. This is an example of the: 
 

27.

The most obvious sorting factor is _____. 
 

28.

There is evidence that every 10 percent increase in the bonus paid to employees by a firm yields a _____ percent increase in ROA to the firm. 
 

29.

Most experts agree that employees do not begin to consider changing their behaviors unless payouts are at least _____ percent higher. 
 

30.

The amount of fairness given to employees refers to _____. 
 

31.

In the formula "Behavior = f (M, A, E)," M denotes monetary incentives. 
 
True    False

32.

When pay raises are based on events over which employees lack significant control, they are likely to regard the system as unfair. 
 
True    False

33.

Flexible compensation is based on the idea that the organization knows what package of rewards would best suit an individual employee's needs. 
 
True    False

34.

Maslow's theory suggests that performance-based pay can be demotivating if it impinges upon employees' capacity to meet daily living needs. 
 
True    False

35.

Herzberg's two-factor theory argues success-sharing plans will be motivating, while at-risk plans will be demotivating. 
 
True    False

36.

An important implication of reinforcement theory is that the timing of payouts to employees is very important. 
 
True    False

37.

Goal-setting theory argues that employees' performance is maximized when performance targets are unchallenging and unspecific. 
 
True    False

38.

Agency theory argues that employees prefer risky pay as rewards can be greater than a salary. 
 
True    False

39.

According to the agency theory, because employees prefer a salary, they will demand a wage premium in exchange for accepting performance-based pay. 
 
True    False

40.

Workload and work variety are both components of a total reward system. 
 
True    False

41.

Security in terms of compensation refers to the predictability of one's paycheck from one time to the next. 
 
True    False

42.

The trend today is toward less stable and less secure compensation packages. 
 
True    False

43.

The authors argue that a system of flexible compensation could lead to more desirable employee behaviors at a lower total cost. 
 
True    False

44.

Gain sharing poses greater risk to individual employees than profit sharing. 
 
True    False

45.

Risk-sharing plans include a provision for cuts in base pay that are only recaptured in years when an organization meets performance objectives. 
 
True    False

46.

Evidence suggests that talented people are motivated to join organizations with strong links between performance and pay. 
 
True    False

47.

Group incentive pay increases turnover of better performers, while individual incentive increases turnover of poorer performers. 
 
True    False

48.

Evidence suggests that skill-based pay may not increase productivity. 
 
True    False

49.

A problem with incentive pay plans is workers may end up focusing exclusively on behaviors that are rewarded. 
 
True    False

50.

Group pay is always more effective than individual pay. 
 
True    False

51.

What are the behaviors that compensation needs to enforce? 
 

52.

What predictions can be made about performance-based pay based on Maslow's theory? 
 

53.

Briefly explain the concept of flexible compensation. 
 

54.

Explain the expectancy theory of motivation. 
 

55.

Compare risk-sharing and success-sharing plans.