Q&A Hero

Human Resource

Q: To encourage a high level of customer service from salespeople, a straight commission is most effective.
Q: A trend in sales force compensation is linking sales force compensation to customer satisfaction measures.
Q: Unlike executives, scientists and engineers are less likely to receive lavish athletic facilities and large offices.
Q: Organizations rely very heavily on the market when pricing scientists' and engineers' base pay.
Q: Dual career ladders allow scientists whose careers have reached a plateau to go into management for increased compensation.
Q: An advantage of using stock options to motivate executives is that there is no downside risk.
Q: In most cases, when an executive calls in a compensation consultant, regardless of how well the company is performing, the executive's pay is raised.
Q: The best predictor of CEO pay is performance of the company.
Q: The social comparisons explanation of executives' compensation has proved to be a good explanation.
Q: The 1993 Revenue Reconciliation Act that limited employer deductions for executive compensation to $1 million of executive compensation may have contributed to the growth of executive compensation.
Q: The major reason for the growth of executive compensation has been granting stock options.
Q: Less than 10 percent of companies offer legal counseling to their executives.
Q: ERISA and the tax code specify that the average value of benefits for low-paid employees must be at least 75 percent of those of highly paid employees.
Q: Incentive stock options may be deducted as a company expense.
Q: One problem with using stock options for executives is they may not be paying the executive for performance.
Q: The most recent trend in executive compensation is an increased use of stock options.
Q: Compensation committees of boards of directors typically set executive salaries.
Q: Formal job or competency-based evaluations play the most important role in determining executive salaries.
Q: Corporate boards of directors have generally not been very active in decisions regarding top executive pay that has led to very high pay levels.
Q: Stockholder anger about executive compensation has led to a higher proportion of outside members on boards of directors.
Q: The most popular method of special compensation for supervisors is paying overtime.
Q: Members of boards of directors are not categorized as candidates for special compensation.
Q: Contingent workers are usually considered candidates for special compensation.
Q: Engineers in almost all companies are treated as special compensation cases due to their education and training.
Q: Which of the following is not a reason for the move to contingent workers?A.Cost savingsB.Employees who accept the idea of bounded careers may view contingent status as part of a fast-track developmental sequenceC.The added flexibility such employment offers the employerD.In today's fast-paced marketplace, lean and flexible are desirable characteristics, and contingent workers offer these options
Q: Anyone hired through a temporary-help agency, on an on-call basis, or as an independent contractor is a _____. A.primary worker B.regular worker C.permanent worker D.contingent worker
Q: Which of the following is not an indicator of whether sales quotas are reasonable? A.Can the sales force explain how the quotas were set? B.Do high performers consistently hit their target? C.Are company profit levels acceptable? D.Do low performers show improvement over time?
Q: The most important and most difficult part of sales compensation is _____. A.setting sales quotas B.setting commission rates C.determining fair bonuses D.assessing differences in sales territories
Q: When selling the product requires a long training time and also considerable time to develop an effective sales presentation, the compensation system should _____. A.set specific and challenging sales goals B.have low base pay and high commissions C.be straight commission D.have a large base-pay component
Q: In a maturing market, compensation should emphasize _____. A.low base salary and high sales commissions B.average base salary and large bonuses C.high base salary and performance-based pay based upon customer satisfaction D.market competitive salaries and good perks
Q: Customer satisfaction indices are increasingly popular because of _____. A.a greater emphasis on quality B.the loss of accounts C.sustaining profit improvement D.decreasing employee satisfaction
Q: If improved account retention became a major focus of attention, the performance measure stressed would be _____. A.gross margin on sales or price per unit B.percentage account erosion C.a volume measure D.a customer satisfaction index
Q: Gross margin on sales or price per unit would be the appropriate measurement if the goal is _____. A.increased sales growth B.improved account retention C.profit improvement D.greater emphasis on quality
Q: If the business goal is to increase sales growth, an organization might use a _____. A.percentage account erosion B.gross margin on sales or price per unit C.customer satisfaction index D.volume measure
Q: Popular stereotypes of salespeople characterize them as being heavily motivated by _____. A.financial compensation B.personal growth and job security C.recognition and appreciation D.promotional opportunities
Q: Which of the following is a major factor that influences the design of sales compensation packages? A.Diversity of buyers' needs and preferences B.The nature of people who enter the sales profession C.Political environment D.The company's size
Q: Which of the following is not a likely component of the compensation package for scientists and engineers? A.Large incentives based upon personal performance B.Base salary C.Bonuses based upon meeting project deadlines D.Patents and publications
Q: _____ curve expresses the relationship between years since last degree, performance, and salary. A.The Phillips B.The marginal productivity C.A tenure D.A maturity
Q: In recent years, some firms have tried to deal with the plateau effect and also accommodate the different career motivations of mature scientists and engineers through a(n) _____. A.individual-career ladder B.alternative career path C.military-style career ladder D.dual-career ladder
Q: The most common approach to motivating executives to make decisions that are in the best interests of stockholders is _____.A.high base salaries with few bonusesB.average base salaries with significant firm performance bonusesC.a long-term incentive plan using stock optionsD.average base salary with performance-based perks
Q: The _____ theory argues that executives make decisions that maximize their rewards. A.economic valuation B.agency C.social comparison D.tournament
Q: Research shows that the best predictor of executive pay, by far, is _____. A.firm size B.the number of "insiders" on the board of directors C.the industry in which the firm operates D.firm performance
Q: Today, top executive pay is more than _____ times the pay of the average worker. A.20 B.42 C.275 D.364
Q: The _____ theory argues that executive pay rises to maintain the same relationship to the salaries of lower-level employees. A.economic approach B.team production C.social comparison D.agency
Q: A useful tool for determining the true worth of an entire executive compensation package is _____. A.the balance sheet B.a tally sheet C.the executive's tax return D.an audit of the executive's income and expenses
Q: Which of the following is the most popular executive perk offered by most companies (91 percent)? A.Physical examination B.Income tax preparation C.An executive dining room D.A company car
Q: Which of the following is an example of a popular perk offered to executives? A.Loans at low or no interest B.Office space at a company business location C.An executive dining room D.Additional secretarial services devoted to company matters
Q: (p.484-485)Which of the following is not one of the clauses relating to benefits employers can provide executives? A.Must cover 80 percent of employees B.Must be determinable C.Must meet specific vesting requirements D.Average value of benefits for low-paid employees must be at least 90 percent of those for highly paid employees
Q: Which of the following benefits is not tied to earnings? A.Life insurance B.Disability insurance C.Vehicle loans D.Pensions
Q: At the time it is granted, which of the following has no tax implications for the executive? A.Phantom stock plans B.Incentive stock options C.Stock appreciation rights D.Performance share/unit plans
Q: Nonqualified stock options involve _____. A.purchase of stock at a stipulated price, not conforming with Internal Revenue Code B.cash or stock award determined by increase in stock price at a fixed future date C.cash or stock award determined by increase in stock price during any time chosen in the option period D.grant of stock at a reduced price with the condition that it may not be sold before a specified date
Q: A _____ is a cash or stock award determined by an increase in stock price at a fixed future date. A.phantom stock plan B.performance share/unit plan C.stock appreciation right D.nonqualified stock option
Q: A _____ is a cash or stock award earned through achieving specific goals and is taxed as ordinary income. A.nonqualified stock option B.phantom stock plan C.restricted stock plan D.performance share/unit plan
Q: Explain vesting and portability.
Q: What is a cash-balance plan?
Q: What are the three types of defined contribution plans?
Q: Compare defined benefit plans and defined contribution plans.
Q: What is the purpose of the HIPAA?
Q: Explain the coverage of the FMLA.
Q: Explain the eligibility for unemployment insurance.
Q: What is the central challenge of social security payments? How are they tackled?
Q: What are the areas covered as part of the no-fault insurance under workers' compensation?
Q: Which are the benefits required by statutory law?
Q: Small private employers have recently begun reducing the number of paid holidays.
Q: Requiring a second opinion prior to surgery is an example of a method to reduce employee demand for health care.
Q: Employees have greater choice of doctors in an HMO than in a PPO.
Q: The Pension Benefit Guarantee Corporation protects vested benefits of people in terminated pension plans.
Q: Under the Economic Growth and Tax Reconciliation Act of 2001, employers have three vesting schedule options.
Q: Vesting is the amount of time an employee must work for an employer to be entitled to their employer's contributions to a pension.
Q: The Employee Retirement Security Act states that employers must offer a retirement plan to their employees if they work at least 1250 hours per year.
Q: An IRA is retirement savings plan that is not managed by an employer.
Q: Employees are required to make contributions to cash balance plans.
Q: A qualified deferred compensation plan offers tax advantages to employers.
Q: A 401K is an example of a defined benefit plan.
Q: An advantage to employees of defined contribution (DC) plans over defined benefit is DC plans tend to vest faster.
Q: Most employers prefer defined contribution pension plans to defined benefit plans.
Q: Companies are turning away from 401K type pension plans because they require putting money in "up front" rather than when workers retire.
Q: The two generic types of pension plans are contributory plans and noncontributory plans.
Q: To be eligible for FMLA, an employee has to have worked for an employer at least 1,250 hours in the previous year.
Q: An eligible unemployed person may collect unemployment insurance benefits for 36 weeks in most states.
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