Chapter.10 Exam Questions Human Resource Management

Entrepreneurship, 3e (Bamford)

Chapter 10 Human Resource Management

1) The success of entrepreneurial firms pursuing new opportunities requires a number of deliberate actions by the business founder concerning human resources issues.

2) Human resources, defined in economics terms, is the processing of employees in monetary terms.

3) Human resources has been defined in economics as the quantity and quality of human effort directed toward producing goods and services.

4) Large firms can absorb bad employees easier than small businesses because they have organizational slack.

5) Human resource programs for small companies are the same and have the same effects as large businesses.

6) In an entrepreneurial business, a job description document is meant to be a formal, highly structured document as it might be in a large corporation.

7) The Civil Rights Act currently applies to firms with more than 10 employees. 

8) One action a small business owner might take to establish that the firm is not discriminatory would be to advertise the job widely in several publications.

9) In an interview, an owner can ask an applicant if he or she has ever been arrested for a crime.

10) Whether hiring for a line worker or a first line manager, an owner should devote the same amount of time in checking references.

11) If a job is more central to an organization and has higher required skill levels than other positions, then the importance of employee references decreases.

12) The screening of résumés or applications prior to beginning an interview process for a job and the checking of references is important.

13) A company can use personality testing, even though there is no direct link between the test and the skill set necessary for the job.

14) Equity theory is where people judge how we are being treated relative to how we see others being treated.

15) A frustration of the commission system comes when the firm does not change the rate of the commission even when the company is doing well.

16) Bonus systems are as well defined as profit sharing and the level of reward is independent of the discretion of an entrepreneur.

17) The Fair Labor Standards Act (FLSA) establishes a minimum wage for all workers, except workers on small farms and administrative employees.

18) In a small firm, the cost of health insurance per employee will be equal to that of a large firm.

19) John reviews Michael's performance on the goals and outcomes that were set 12 months ago. This is called a goal review.

20) The setting of goals for an employee allows an entrepreneur to judge how well the employee is performing.

21) Employees are happy and satisfied when they feel that their compensation—given their performance—is equal to that of other employees in the firm or other individuals in similar situations. This is called the equity theory.

22) The time period for which profit sharing or bonuses are given should be relevant to the individuals in a firm and within the realities and constraints of the business.

23) An owner must develop a paper trail regarding an employee's bad performance.

24) A small business owner should be diligent in documenting the performance of employees over time. This helps the owner to terminate an employee for poor performance and also efficiently handle any legal issues that may arise.

25) Workers' compensation is a law designed so that employees who are disabled or injured while on the job are provided with some type of compensation.

26) OSHA stands for Office Standards and Health Administration. 

27) Any fines levied by the Occupational Safety and Health Administration (OSHA) are equal for entrepreneurial businesses with fewer than 25 employees as they are for large businesses.

28) ADA stands for the Americans with Disabilities Act.

29) Workers' compensation insurance rates are regulated by the federal government and are uniform across the country.

30) The rates of workers' compensation insurance for individual firms within a particular state are fairly standard and are generally based on the industry and size of the firm.

31) OSHA has attempted to shape its regulations to be more lenient in its regulations on large businesses than on small businesses.

32) Unemployment compensation is the financial assistance for some period of time to those people who lose their jobs through no fault of their own.

33) Human resource management is not as important in family businesses.

34) Human resources in family businesses are critical, but since family members make up many of the significant employees in the company, everything becomes more delicate.

35) Human resource management includes ________ the employees.

A) hiring

B) inspiring

C) managing

D) all of these

36) ________ is the quantity and quality of human effort directed toward producing goods and services.

A) Human power

B) Human skills

C) Human knowledge

D) Human resource management

37) Human resources is defined in economics terms as the ________ and ________ of human effort directed toward producing goods and services. 

A) producing; manufacturing

B) monetary; utility

C) quantity; quality

D) developing; producing

38) Which of the following represents the impact of a poor employee on the functioning of a small business? 

A) The problems may bleed over to other employees.

B) The organization does not fully benefit from the employee.

C) The owner's time is lost.

D) All of these

39) Which of the following is a document that describes a job that is to be filled? 

A) Job design

B) Job analysis

C) Job plan

D) Job description

40) When a small business owner is advertising a job, the company needs to attract ________ pool of applicants to choose from.  

A) the smallest

B) the largest

C) the best qualified

D) a diverse

41) Which of the following laws prohibits discrimination in hiring, dismissal, or promotion on the basis of race, color, gender, religious beliefs, or national origins?  

A) The Americans with Disabilities Act

B) The Civil Rights Act

C) The Fair Labor Act

D) The Age Discrimination Act

42) In an interview, an interviewer can ask questions about 

A) disability.

B) prior convictions.

C) arrest record.

D) religion.

43) A job offer is finalized by ________.  

A) a handshake

B) employer putting it in writing

C) candidate reading the offer

D) candidate signing the offer

44) Job advertisements written for a new hire should 

A) contain the current challenges faced by the industry.

B) be similar to the generic advertisements placed every week.

C) give maximum information needed for a potential applicant.

D) be kept concise and should communicate the culture of the firm.

45) Which of the following statements is true of the Civil Rights Act?  

A) It allows for the promotion of the differently abled employees irrespective of their performance.

B) It provides that each and every business must provide unfettered access to all disabled people.

C) It ensures that all individuals are judged according to the discretion of an entrepreneur.

D) It currently applies to all firms with more than 25 employees.

46) Which of the following information should be obtained in the application/interview process?  

A) Education and training

B) Work history

C) Social Security number

D) All of these

47) Which of the following terms means a set amount of compensation for a given time period?  

A) Paycheck

B) Hourly wage

C) Salary

D) Commission

48) When a small business owner pays an individual a percentage of sales, this is called a ________.  

A) paycheck

B) bonus

C) commission

D) salary

49) Which of the following statements is true of the commission compensation system?  

A) It creates an overall healthy environment within a firm when the salespeople are very focused on their commission.

B) It creates a uniform system in a firm where every employee is paid the same amount as commission, and it is independent of their performance.

C) It creates a rigid compensation system where abuse is minimal, and it removes the frustration for employees and the entrepreneur.

D) It creates frustration when a firm either does or does not change a commission program to reflect the growth of the firm.

50) When a small business owner pays a commission in addition to a basic salary, it is called ________.  

A) a bonus

B) profit sharing

C) a salary

D) hybrid compensation

51) A firm sets up a low level of salary but offers to share a percentage of its profits at the end of the year. What is this called?  

A) Bonus

B) Profit sharing

C) Salary

D) Bonus plus

52) Identify an accurate statement about the hybrid compensation system.  

A) An entrepreneur should not differentiate the level of rewards among his employees and should maintain a well-defined structure.

B) An entrepreneur should provide bonuses in a timely manner that is relevant to the individuals in the firm and within the realities and constraints of the business.

C) An entrepreneur needs to visualize a quarter as a relevant time frame, whereas workers need to visualize weekly feedback on their performance through a bonus.

D) An entrepreneur need not consider the industry standards in developing a compensation system.

53) Which of the following laws established a minimum wage for workers?  

A) The Fair Labor Standards Act

B) The Civil Rights Act

C) The Americans with Disabilities Act

D) The Sherman's Antitrust Act

54) Which of the following laws states an employer cannot discriminate in pay to men and women who do the same job?  

A) The Americans with Disabilities Act

B) The Civil Rights Act

C) The Equal Pay Act

D) The Fair Labor Standards

55) Which of the following statements is true of the Fair Labor Standards Act (FLSA)?  

A) It requires that all nonexempt employees who work over 40 hours a week should be paid at the rate of time and a half.

B) It includes all workers, including workers on small farms and administrative employees.

C) It provides that each and every business must provide unfettered access to all disabled people.

D) It allows an entrepreneur to employee children under the age of 15 years if he or she can establish the safety of the working environment.

56) A(n) ________ is an index wage that requires the minimum wage to be at least what someone who works 40 hours a week needs to stay out of poverty.  

A) wage ratio

B) living wage

C) wage ceiling

D) efficiency wage

57) The government regulates the employment of children under the age of ________.  

A) 16

B) 18

C) 20

D) 21

58) An example of a benefit a company can offer is 

A) 401(k)

B) retirement plans.

C) sick leave.

D) all of these.

59) A program that allows employees to contribute to their retirement on a tax-free basis is ________.  

A) 401(k)

B) 401(C)

C) 401(F)

D) 401(T)

60) Currently under the ________, firms with more than 50 employees are required to offer their employees insurance.  

A) Americans with Disabilities Act

B) Equal Pay Act

C) Fair Labor Standards Act (FLSA)

D) Affordable Care Act

61) Which of the following statements is true of a performance review in an entrepreneurial business?  

A) A new firm should wait for a year to give feedback, and newer generations of employees are looking for such feedback.

B) A complex form should be followed for all performance reviews that are given in writing to assure its validity.

C) The formal conversation with a worker who is doing a good job and appreciating his or her work is a form of compensation.

D) If a worker is not performing as expected, then the employer should give only positive feedback to boost the worker's morale.

62) A(n) ________ is needed regarding all employees, and the owner must be diligent in the attempt to assist a poorly performing employee.  

A) paper trail

B) performance review

C) audit profile

D) firing document

63) An employee cannot sue a small business owner for injury, if the individual accepts ________.  

A) unemployment compensation

B) workers' compensation

C) social security

D) employment compensation

64) What percentage of states has an unemployment compensation law?  

A) 25

B) 50

C) 75

D) 100

65) The Americans with Disabilities Act regulates firms with how many employees?  

A) 20 or more employees

B) 15 or more employees

C) Less than 20 employees

D) Less than 15 employees

66) Which of the following statements is true of the Americans with Disabilities Act (ADA)?  

A) It covers those firms with 50 or more employees.

B) It provides that each and every business must provide unfettered access to all differently abled people.

C) It is applicable to large business firms with a turnover of more than 10 million dollars.

D) It allows entrepreneurial businesses to exclude candidates who need physical adaptations to work at the firm.

67) According to the book, which of the following firms needs to pay special attention to OSHA guidelines?  

A) Manufacturing firms

B) IT firms

C) Family business forms

D) None of these

68) Identify a legal question that an employer can ask during an interview.  

A) "Are you married?"

B) "Are you heterosexual or homosexual?"

C) "Do you have a Social Security number?"

D) "Are you a Republican or a Democrat?"

69) According to the workers' compensation requirements, what are the conditions under which employees are compensated for their injuries?  

A) The employee is injured from an unsafe workplace where he/she is working.

B) The employee has physical injuries due to unsafe working condition.

C) The injury is caused due to the employer's negligence and fault.

D) All of these

70) What does OSHA stand for?  

A) Occupational Safety and Help Administration

B) Occupational Safeguard and Health Administration

C) Occupational Safety and Health Administration

D) Occupational Shelter and Help Administration

71) Which of the following statements is true of a family business?  

A) It is generally run by and for the benefit of a particular family.

B) It gives no importance for human resource management in the business.

C) It seldom takes rational decisions for the benefit of the business.

D) It eliminates issues of discrimination if the firm is large.

72) ________ theory states that all individuals judge how we are treated relative to how we see others being treated.

73) Mike sells $10,000.00 worth of product; the owner gives him $2,000.00. This is called a(n) ________.

74) A(n) ________ is a pay system where there is a salary with commission.

75) A(n) ________ is the review by an entrepreneurial business owner of an employee's goals and outcomes on those goals over some given period.

76) In a family business, the founder needs to choose a(n) ________ and prepare that person to take over the business.

77) List the elements that should be on a job description.

78) List some of the ways to advertise a job and to attract a large pool of applicants.

79) List the elements on a job application.

80) List and describe the four types of basic compensation.

81) List five benefits and explain the problems associated with them.

82) What are some problems a human resource manager has in a family business?