Compensation 10th Edition By Milkovich Newman And Gerhart Plumbing

Product Description Compensation, 10th Edition, by Milkovich, Newman and Gerhart is the market-leading text in this course area. It offers instructors current research material, in depth discussion of topics, integration of Internet coverage, excellent pedagogy, and a truly engaging writing style.

The authors consult with leading businesses, have won teaching awards, and publish in the leading journals. This text examines the strategic choices in managing total compensation. The total compensation model introduced in chapter one serves as an integrating framework throughout the book. The authors discuss major compensation issues in the context of current theory, research, and real-business practices. Milkovich, Newman and Gerhart strive to differentiate between beliefs and opinions from facts and scholarly research. They showcase practices that illustrate new developments in compensation practices as well as established approaches to compensation decisions. Time after time, adopters relay stories of students getting job offers based on the knowledge they learned from this book.

This book is blah. Barely any graphics, charts, or pictures to spice things up, and it is black and white which you don't realize how boring a text book can be until they take the color out. Also, the authors try to make weird jokes through out the book that really detract from the point they are trying to teach. Example: Page 306, 'The oil that lubricates the compensation engine (email the authors if you agree this is a horrible metaphor!) is performance measurement and performance management.' What.Why would they say that?

If its a horrible metaphor why publish it?! Example: page 306 again: 'Who buys an explorer that gets 17 mpg when gas now costs over $4/gallon? (except of course a dumb second author! By the way, it's a really pretty red!) HR can't control these types of environmental obstacles, after all.'

Test Bank For Compensation 10th Edition by George Milkovich, Jerry Newman, Barry Gerhart $ 35.00. Fourth Edition. The Ohio State University. Michigan State University. Barry Gerhart. University of Wisconsin–Madison. Compensation 504. HRM Technology 504. Inflexible without Technology 505. Web 2.0 for Human Resource Management 508.

.did they just refer to one of the authors as dumb? THIS is what I mean. Its through out the whole book. Example stories not very good. If you are a teacher, I would look for another book. This book was selected by my university: Webster (out of St. Louis, Missouri) for my online course.

I have used other textbooks for other classes and though, good, there were not as well written as this one. The authors did a great job with this book. It feels more like a conversation with them than a typical textbook.

This style and accuracy of the content make an otherwise trying subject very interesting, pleasant and inviting. Additionally, it provides great reference points that stimulate the reader's curiosity--in this case me. You have my permission to quote me. This was a required text for my Total Rewards class. Sadly, I ended up using search engines, and HR websites to help with learning the direct explanations of each chapter assigned (basically the whole book).

At no point in the 8-week course was I able to use the book as a reference. It was much easier to be where internet service was and go web-surfing. With the internet and my own common sense/logical conclusions, the assignments were completed. The only time I used any part of the book was to give a 'gimme' and reference it in my papers.

It reads like a drunk's chatter. Vocabulary words (found in the glossary) are sometimes not in bold face or italicized. It is difficult to tell if a particular word is a vocabulary word or not, because the word will not be clearly defined in the text (no indication basically). Furthermore, it will be a familiar word like 'professional,' so one wouldn't think it would be a vocabulary word. A word will be introduced, not clearly defined, and much later be defined a little better making it difficult to write notes in an effective and efficient manner.

Sentences will not be clearly stated. Paragraphs and the chapters in general are unfocused.

I have a hard time believing any of the authors ever took an English class or that this book had any editors. This book is a joke. How can I focus on the content, and become a compensation analyst when my textbook is so poorly written.

Description Multiple Choice Questions 1.Which of the following includes restrictions on executive pay that are designed to discourage executives from taking “unnecessary and excessive risks”? Corporate Welfare Program B. Employee Welfare Program 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.

90% 3.Employers spend ____ cents for benefits in addition to each dollar of wages or salaries. 14 4.Hourly compensation costs for manufacturing workers are higher in _____ than the U.S. Czech Republic C. Singapore 5.One of the reasons 8 in 10 working families have no health insurance is because ______. Many large employers do not offer health insurance B.

Health insurance is more costly at large employers C. Many small employers do not offer health insurance D. Most workers decline health insurance when offered by their employer 6._____ would be most concerned about executive pay. Stockholders 7._____ would be most concerned about compensation as a major expense.

Stockholders 8.The primary reason compensation is important to managers is because: A. Employees regard it as a reward.

It influences employee behavior. It is a larger cost than benefits. Stock holders dislike high compensation costs. 9.“Say on pay” is part of a law designed to protect the interests of ___________. Shareholders 10.Employees view compensation as all but which of the following? An entitlement C. An investment 11.Costco has higher labor costs than Walmart and Sam’s Club.

The result is Costco has better performance in all but which of the following? Customer satisfaction D. Sales/square foot 12.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. Incentive effect.

Motivational effect. Directional effect. 13.In China, compensation, daiyu, has come to mean A. Entitlement and benefits. Cash compensation. Returns and entitlement. Cash compensation and relational returns.

14.In Japanese companies, the concept of teate is consistent with which of the following? Sophisticated performance appraisal systems B. A strong emphasis on performance pay C. Family, housing and commuting allowances D. Rapid promotions 15.Which of the following is an example of a relational return? Short-term incentives B.

Recognition and status C. Work-life balance D. Income protection 16.Which of the following are given as increments to the base pay in recognition of past work behavior?

Cost-of-living adjustments C. Incentives 17.Which form of pay is likely to be least expensive for employers?

Cost-of-living adjustments D. Base pay 18.Recent surveys show the average merit raise for an outstanding performer is ______ and average performers receive and poor performers receive 0.4%. 4.4, 2.8 19.Employees who want to be sure their good performance will be rewarded will prefer A. Team incentives. Individual incentives. Across-the-board pay increases 20.Variable pay may also be called A. Stock options.

21.Which of the following is the largest component in an executive pay package? Stock options C.

Perks 22.Employers’ annual cost per employee to provide family health care coverage is approximately ______________. $20000 23.A company that says its relatively low starting pay will be offset by larger future pay increases is using the concept of ____. Present-value B. Incentives D. Deferred benefits 24.All of the following have direct financial costs for an employer except: A. Relational returns C.

Work-life balance D. Income protection 25.Which of the following is not an objective in the pay model? Compliance C.

Efficiency D. Productivity 26.Costs are to management as _____ is to alignment. Work analysis B.

Communication C. Merit guideline 27.Market definitions are to competitiveness as performance based is to ____. Compliance C. Efficiency D.

Contribution 28.Which of the following is not a policy in the pay model? Competitiveness C.

Contributions D. Alignment 29.Which of the following is not an objective of the pay model? Competitiveness C. Efficiency D.

Fairness 30.Cost is to change in the pay model as ______________ are to policy lines. Market definitions B. Descriptions D.

Incentives 31.Seniority based, incentive and merit guidelines are components of the ____________ policy. Internal alignment B. Efficiency C. Competitiveness D. Management 32._____ refers to comparisons among jobs or skills inside a single organization. External competitiveness B.

Internal alignment C. Pay structure D. Equitable contributions 33.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? External competitiveness B. Employee contributions C. Internal alignment D.

Job evaluation 34.Managers seek internal alignment within their organization by: A. Matching competitors’ pay rates. Following FLSA guidelines. Using fair merit increases. Paying on the basis of similarities among jobs.

35.Compensation policy choices affecting pay level are most closely associated with ____. Internal alignment B.

External competitiveness C. Contributions D.

Management 36.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. Cost control B. Internal alignment C.

Contributions D. External competitiveness 37.Choices among pay for performance, flat rate pay and profit sharing are examples of _____ policy decisions. Internal alignment B. Efficiency C. Employee contributions D.

Management 38.According to the text, which of the following decisions should be made jointly? Internal alignment and Management.

External competitiveness and Employee contribution C. Employee contribution and Internal alignment D. Management and External competitiveness 39.Page: 22Which of the following policy decisions directly affects employees’ attitudes and work behaviors? Employee contributions B.

Internal alignment C. External competitiveness D. Management 40.Which of the following decisions answers the “So What” question? Internal alignment B. Employee contributions C. External competitiveness D. Management 41.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?

Internal alignment B. Efficiency C.

Employee contributions D. Management 42.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. High base pay B. Great benefits that attract and retain workers C. A combination of goal setting and job enrichment D.

Monetary incentives 43.Which of the following is not a guideline for determining if research has value? Is the research useful B. Can alternative explanations be ruled out C. Was the research conducted by Ph D researchers D. Is correlation separated from causation 44.A measure of how changes in one variable are related to changes in another variable is: A. Standard deviation B. Analysis of variance C.

Correlation coefficient D. Regression analysis 45.The best way to establish _____ is to account for competing explanations, either statistically or through control groups. Profitability C. Correlation coefficient D. Internal alignment True / False Questions 46.Companies that pay high wages compared to their industry competitors, such as Nucor Steel and General Motors did for many years, are likely to go bankrupt.

True False 47.A financial expert concluded that misaligned incentive programs were a major cause of the recent crisis in the US financial system. True False 48.The U.S. Has the highest hourly compensation costs for manufacturing workers of any industrialized nation.

True False 49.When unemployment increases, the proportion of the population covered by health insurance decreases. True False 50.Since the U.S. Has the highest hourly compensation costs for manufacturing workers of any industrialized nation, executives could minimize total labor costs by producing in low cost countries such as China and Mexico. True False 51.Compensation is important to managers’ success because it is a major cost and it influences employee behavior. True False 52.The degree to which pay influences individual and aggregate motivation among employees is called the sorting effect. True False 53.The degree to which pay influences individual and aggregate motivation among employees is called the sorting effect. True False 54.Total compensation includes relational returns, cash compensation and benefits.

True False 55.In jobs paid a base wage, the wage is the same for everyone with the same job title. True False 56.Challenging work and employment security are examples of total compensation. True False 57.Employees classified as non-exempt under FLSA are paid a salary, not wages.

True False 58.Commissions are an example of incentives. True False 59.If you often had to work 50 or more hours per week at an assembly job, you would probably prefer to that your job is classified as exempt under the FLSA. True False 60.Most U. Firms use merit pay increases. True False 61.Base wage reflects both the value of the work and individual employee skills and experience. True False 62.A bonus promised by your boss if costs are below your budget is a merit increase. True False 63.In practice, there is no real difference between merit pay increases and cost-of-living adjustments.

True False 64.Pension and health benefits are a very large component of total compensation for many large companies such as American Airlines and GM. True False 65.A major challenge facing most employers is the rising cost of health care benefits. True False 66.The most important of the pay model policies for assuring fairness is contributions. True False 67.The objective of compliance suggests the way a pay decision is made may be as important to employees as the results of that decision. True False 68.Compensation professionals’ conduct is guided by the American Compensation Association’s Code of Ethics. True False 69.If an objective is to increase customer satisfaction, then incentive programs and merit pay might be used to pay for performance. True False 70.Objectives guide the design of pay systems and provide standards for evaluating their effectiveness.

True False 71.The objective of procedural fairness suggests the way a pay decision is made may be as important to employees as the results of that decision. True False 72.Internal alignment refers to comparisons among jobs or skill levels inside a single organization. True False 73.Contributions refers to employees’ perceptions of the fairness of pay differences among different jobs within their organization. True False 74.External competitiveness decisions focus on both pay levels. True False 75.Management of the pay system focuses on cost control and employee perceptions of fairness since they are most important to management. True False 76.The policy choice of management means ensuring that the right people get the right pay for achieving the right objectives in the right way.

True False 77.Since HR research contains information useful to managers, most managers read research in HR, management and compensation journals. True False 78.Management and HR research has conclusively shown that goal setting and job enrichment produce the largest and most reliable increases in job performance. True False 79.Monetary incentives produce the biggest increases in job performance. True False 80.An important criteria for determining the value of research is whether the research is useful. True False 81.An important criteria for determining the value of research is/are there alternative An 80. An important criteria for determining the value of research is/are there alternative explanations for the research findings? True False 82.A study found that there is only a very small amount of change in CEO pay is related to changes in company performance.

True False 83.A study of IBM showed that their long-standing policy of no layoffs was the major cause of their strong profits. True False 84.Causality is one of the most difficult questions to answer and continues to be an important and sometimes perplexing problem for researchers.

True False 85.The R2 is different form correlation in that it tells us what percentage of the variation is accounted for by the variables we are using to predict or explain. True False Short Answer Questions 86.Compensations differ with perspective. What are the different perspectives of compensation described in the text? 87.Describe stockholders perspective on compensation. 88.What are the different ways in which employees see compensation? 89.What are the different ways in which pay can influence employee motivation and behavior?

90.Describe the various returns received from work. 91.Write short notes on the different types of cash compensations discussed in the text. 92.Write short notes on the different types of benefits discussed in the text. 93.List the basic elements of the pay model.

94.Explain the compensation objectives of the pay model. The basic objectives include efficiency, fairness, ethics, and compliance with laws and regulations.

95.List and define the different policy decisions of the pay model. Chapter 01 The Pay Model AnswerKey Multiple Choice Questions 1.

5)Which of the following includes restrictions on executive pay that are designed to discourage executives from taking “unnecessary and excessive risks”? Corporate Welfare Program B. Employee Welfare Program C. Troubled Asset Relief Program D.

Corporate Liability Relief Program Difficulty: Medium 2. 5)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. 90% Difficulty: Easy 3. 5)Employers spend ____ cents for benefits in addition to each dollar of wages or salaries. 14 Difficulty: Hard 4. 6)Hourly compensation costs for manufacturing workers are higher in _____ than the U.S.

Czech Republic C. Singapore Difficulty: Medium 5. 6)One of the reasons 8 in 10 working families have no health insurance is because ______. Many large employers do not offer health insurance B. Health insurance is more costly at large employers C. Many small employers do not offer health insurance D.

Most workers decline health insurance when offered by their employer Difficulty: Medium 6. 7)_____ would be most concerned about executive pay.

Stockholders Difficulty: Easy 7. 7)_____ would be most concerned about compensation as a major expense.

Stockholders Difficulty: Easy 8. 9)The primary reason compensation is important to managers is because: A. Employees regard it as a reward. It influences employee behavior.

It is a larger cost than benefits. Stock holders dislike high compensation costs.

Difficulty: Medium 9. 9)“Say on pay” is part of a law designed to protect the interests of ___________. Shareholders Difficulty: Hard 10. 11)Employees view compensation as all but which of the following? An entitlement C. An investment Difficulty: Medium 11. 10-11)Costco has higher labor costs than Walmart and Sam’s Club.

The result is Costco has better performance in all but which of the following? Customer satisfaction D. Sales/square foot Difficulty: Medium 12. 11)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. Incentive effect. Motivational effect.

Directional effect. Difficulty: Easy 13.

12)In China, compensation, daiyu, has come to mean A. Entitlement and benefits. Cash compensation. Returns and entitlement. Cash compensation and relational returns. Difficulty: Medium 14. 12)In Japanese companies, the concept of teate is consistent with which of the following?

Sophisticated performance appraisal systems B. A strong emphasis on performance pay C. Family, housing and commuting allowances D. Rapid promotions Difficulty: Medium 15.

13)Which of the following is an example of a relational return? Short-term incentives B. Recognition and status C. Work-life balance D.

Income protection Difficulty: Medium 16. 14)Which of the following are given as increments to the base pay in recognition of past work behavior? Cost-of-living adjustments C. Incentives Difficulty: Medium 17. 15)Which form of pay is likely to be least expensive for employers? Cost-of-living adjustments D.

Base pay Difficulty: Medium 18. 15)Recent surveys show the average merit raise for an outstanding performer is ______ and average performers receive and poor performers receive 0.4%. 4.4, 2.8 Difficulty: Hard 19. 15)Employees who want to be sure their good performance will be rewarded will prefer A.

Team incentives. Individual incentives. Across-the-board pay increases Difficulty: Hard 20. 15)Variable pay may also be called A. Stock options.

Difficulty: Medium 21. 15)Which of the following is the largest component in an executive pay package? Stock options C. Perks Difficulty: Medium 22.

16)Employers’ annual cost per employee to provide family health care coverage is approximately ______________. $20000 Difficulty: Hard 23. 17)A company that says its relatively low starting pay will be offset by larger future pay increases is using the concept of ____. Present-value B. Incentives D. Deferred benefits Difficulty: Hard 24.

17)All of the following have direct financial costs for an employer except: A. Relational returns C.

Work-life balance D. Income protection Difficulty: Hard 25. 18)Which of the following is not an objective in the pay model?

Compliance C. Efficiency D. Productivity Difficulty: Easy 26. 18)Costs are to management as _____ is to alignment. Work analysis B. Communication C. Merit guideline Difficulty: Hard 27.

18)Market definitions are to competitiveness as performance based is to ____. Compliance C. Efficiency D. Contribution Difficulty: Hard 28.

18)Which of the following is not a policy in the pay model? Competitiveness C. Contributions D. Alignment Difficulty: Medium 29.

18)Which of the following is not an objective of the pay model? Competitiveness C. Efficiency D. Fairness Difficulty: Medium 30.

18)Cost is to change in the pay model as ______________ are to policy lines. Market definitions B. Descriptions D. Incentives Difficulty: Hard 31. 18)Seniority based, incentive and merit guidelines are components of the ____________ policy. Internal alignment B. Efficiency C.

Competitiveness D. Management Difficulty: Easy 32. 21)_____ refers to comparisons among jobs or skills inside a single organization. External competitiveness B. Clone Dvd 2930 Cracked on this page.

Internal alignment C. Pay structure D.

Equitable contributions Difficulty: Easy 33. 22)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? External competitiveness B. Employee contributions C. Internal alignment D. Job evaluation Difficulty: Medium 34.

22)Managers seek internal alignment within their organization by: A. Matching competitors’ pay rates. Following FLSA guidelines.

Using fair merit increases. Paying on the basis of similarities among jobs. Difficulty: Medium 35. 25)Compensation policy choices affecting pay level are most closely associated with ____. Internal alignment B. External competitiveness C.

Contributions D. Management Difficulty: Easy 36.

22)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. Cost control B.

Internal alignment C. Contributions D.

External competitiveness Difficulty: Medium 37. 22)Choices among pay for performance, flat rate pay and profit sharing are examples of _____ policy decisions.

Internal alignment B. Efficiency C. Employee contributions D. Management Difficulty: Medium 38. 23)According to the text, which of the following decisions should be made jointly? Internal alignment and Management. External competitiveness and Employee contribution C.

Employee contribution and Internal alignment D. Management and External competitiveness Difficulty: Easy 39. 22)Page: 22Which of the following policy decisions directly affects employees’ attitudes and work behaviors? Employee contributions B. Internal alignment C. External competitiveness D. Management Difficulty: Easy 40.

23)Which of the following decisions answers the “So What” question? Internal alignment B. Employee contributions C.

External competitiveness D. Management Difficulty: Medium 41. 23)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? Internal alignment B.

Efficiency C. Employee contributions D. Management Difficulty: Hard 42. 25)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. High base pay B.

Great benefits that attract and retain workers C. A combination of goal setting and job enrichment D. Monetary incentives Difficulty: Medium 43. 25-27)Which of the following is not a guideline for determining if research has value? Is the research useful B.

Can alternative explanations be ruled out C. Was the research conducted by Ph D researchers D. Is correlation separated from causation Difficulty: Medium 44. 26)A measure of how changes in one variable are related to changes in another variable is: A. Standard deviation B.

Analysis of variance C. Correlation coefficient D.

Regression analysis Difficulty: Hard 45. 27)The best way to establish _____ is to account for competing explanations, either statistically or through control groups. Profitability C. Correlation coefficient D. Internal alignment Difficulty: Hard True / False Questions 46. 4)Companies that pay high wages compared to their industry competitors, such as Nucor Steel and General Motors did for many years, are likely to go bankrupt.

FALSE Difficulty: Medium 47. 5)A financial expert concluded that misaligned incentive programs were a major cause of the recent crisis in the US financial system. TRUE Difficulty: Easy 48.

Has the highest hourly compensation costs for manufacturing workers of any industrialized nation. FALSE Difficulty: Easy 49. 6)When unemployment increases, the proportion of the population covered by health insurance decreases. TRUE Difficulty: Medium 50. 6)Since the U.S. Has the highest hourly compensation costs for manufacturing workers of any industrialized nation, executives could minimize total labor costs by producing in low cost countries such as China and Mexico. FALSE Difficulty: Hard 51.

9)Compensation is important to managers’ success because it is a major cost and it influences employee behavior. TRUE Difficulty: Easy 52. 10-11)The degree to which pay influences individual and aggregate motivation among employees is called the sorting effect. FALSE Difficulty: Medium 53. 10-11)The degree to which pay influences individual and aggregate motivation among employees is called the sorting effect. FALSE Difficulty: Medium 54.

13)Total compensation includes relational returns, cash compensation and benefits. FALSE Difficulty: Medium 55. 14)In jobs paid a base wage, the wage is the same for everyone with the same job title. FALSE Difficulty: Hard 56. 13)Challenging work and employment security are examples of total compensation.

FALSE Difficulty: Medium 57. 14)Employees classified as non-exempt under FLSA are paid a salary, not wages.

FALSE Difficulty: Easy 58. 15)Commissions are an example of incentives. TRUE Difficulty: Easy 59. 14)If you often had to work 50 or more hours per week at an assembly job, you would probably prefer to that your job is classified as exempt under the FLSA.

FALSE Difficulty: Medium 60. Firms use merit pay increases. TRUE Difficulty: Easy 61.

11)Base wage reflects both the value of the work and individual employee skills and experience. FALSE Difficulty: Medium 62. 15)A bonus promised by your boss if costs are below your budget is a merit increase. FALSE Difficulty: Medium 63. 15)In practice, there is no real difference between merit pay increases and cost-of-living adjustments.

FALSE Difficulty: Easy 64. 16)Pension and health benefits are a very large component of total compensation for many large companies such as American Airlines and GM. TRUE Difficulty: Easy 65. 16)A major challenge facing most employers is the rising cost of health care benefits. TRUE Difficulty: Easy 66. 19)The most important of the pay model policies for assuring fairness is contributions. FALSE Difficulty: Medium 67.

19)The objective of compliance suggests the way a pay decision is made may be as important to employees as the results of that decision. FALSE Difficulty: Easy 68. 20-21)Compensation professionals’ conduct is guided by the American Compensation Association’s Code of Ethics. FALSE Difficulty: Medium 69.

21)If an objective is to increase customer satisfaction, then incentive programs and merit pay might be used to pay for performance. TRUE Difficulty: Easy 70. 21)Objectives guide the design of pay systems and provide standards for evaluating their effectiveness. TRUE Difficulty: Medium 71. 19)The objective of procedural fairness suggests the way a pay decision is made may be as important to employees as the results of that decision. TRUE Difficulty: Easy 72.

Mcdsp Emerald Pack Torrent Mac Office. 21)Internal alignment refers to comparisons among jobs or skill levels inside a single organization. TRUE Difficulty: Easy 73.

22)Contributions refers to employees’ perceptions of the fairness of pay differences among different jobs within their organization. FALSE Difficulty: Easy 74. 22)External competitiveness decisions focus on both pay levels. TRUE Difficulty: Easy 75. 23)Management of the pay system focuses on cost control and employee perceptions of fairness since they are most important to management. FALSE Difficulty: Medium 76. 23)The policy choice of management means ensuring that the right people get the right pay for achieving the right objectives in the right way.

TRUE Difficulty: Easy 77. 25)Since HR research contains information useful to managers, most managers read research in HR, management and compensation journals. FALSE Difficulty: Medium 78.

25)Management and HR research has conclusively shown that goal setting and job enrichment produce the largest and most reliable increases in job performance. FALSE Difficulty: Medium 79. 25)Monetary incentives produce the biggest increases in job performance.

TRUE Difficulty: Easy 80. 26)An important criteria for determining the value of research is whether the research is useful.

TRUE Difficulty: Easy 81. 24)An important criteria for determining the value of research is/are there alternative An 80. An important criteria for determining the value of research is/are there alternative explanations for the research findings? TRUE Difficulty: Medium 82. 26)A study found that there is only a very small amount of change in CEO pay is related to changes in company performance.

TRUE Difficulty: Hard 83. 26)A study of IBM showed that their long-standing policy of no layoffs was the major cause of their strong profits. FALSE Difficulty: Medium 84.

26)Causality is one of the most difficult questions to answer and continues to be an important and sometimes perplexing problem for researchers. TRUE Difficulty: Easy 85. 26)The R2 is different form correlation in that it tells us what percentage of the variation is accounted for by the variables we are using to predict or explain. FALSE Difficulty: Medium Short Answer Questions 86.

4)Compensations differ with perspective. What are the different perspectives of compensation described in the text? The text describes compensation from the perspective of a member of society, a stockholder, a manager, and an employee. Difficulty: Easy 87. 6)Describe stockholders perspective on compensation.

Stockholders are interested in how employees are paid. Using stock to pay employees creates a sense of ownership which improves performance and increase stockholder wealth. However, granting employees too much ownership dilutes stockholder wealth.

Stockholders have a particular interest in executive pay. The interests of executives are aligned with those of shareholders who hope that company performance will be higher.

Difficulty: Medium 88. 8)What are the different ways in which employees see compensation? Employees see compensation as a return in an exchange between their employer and themselves, as an entitlement for being an employee of the company, or as a reward for a job well done. Difficulty: Easy 89. 9)What are the different ways in which pay can influence employee motivation and behavior? Pay can influence employee motivation and behavior in two ways: i.

Pay can affect the motivational intensity, direction, and persistence of current employees. The degree to which pay influences individual and aggregate motivation among the employees at any point in time is referred to as incentive effect. Pay can also have an indirect, but important influence, via, a sorting effect. Different types of pay strategies cause different types of people to apply to and stay with an organization.

Difficulty: Medium 90. 10-11)Describe the various returns received from work. Returns are categorized in two: i. Relational returns are psychological and include learning opportunities, status, challenging work, and other psychological aspects.

Total compensations are transactional and include a. Pay received directly as cash through base pay, merit, incentives, cost-of-living adjustments etc. Pay received indirectly as benefits through pensions, medical insurance, programs to help balance work and life demands, bright colored uniform etc. Difficulty: Hard 91. 11-12)Write short notes on the different types of cash compensations discussed in the text. Base pay is the cash compensation that an employer pays for the work performed. It tends to reflect the value of the work or skills and generally ignores differences attributable to individual employees.

Merit increases are given as increments to the base pay in recognition of past work behavior. Some assessment of past performance is made, with or without a formal performance evaluation program, and the size of the increase is varied with performance. Cost-of-living adjustments give the same increases as merit, but to everyone, regardless of performance. Incentives tie pay increases directly to performance but differ from merit adjustments in two ways.

Incentives can be tied to the performance of an individual employee, a team of employees, a total business unit, or some combination of individual, team, and unit. Incentives are one-time payments and do not permanently increase labor costs. When performance declines, incentive pay automatically declines, too.

Consequently, incentives are frequently referred to as variable pay. Long-term incentives are intended to focus employee efforts on multiyear results.

Typically they are in the form of stock ownership or options to buy stock at specified, advantageous prices. Difficulty: Medium 92. 13-14)Write short notes on the different types of benefits discussed in the text. In the United States, employers must pay into a fund that provides income replacement for workers who become disabled or unemployed. Employers also make half the contributions to Social Security. (Employees pay the other half.) Different countries have different lists of mandatory benefits. Medical insurance, retirement programs, life insurance, and savings plans are common benefits.

Programs that help employees better integrate their work/life balance include time away from work (vacations, jury duty), access to services to meet specific needs (drug counseling, financial planning, referrals for child and elder care), and flexible work arrangements (telecommuting, nontraditional schedules, nonpaid time off). Allowances often grow out of whatever is in short supply and differ from region to region. Difficulty: Medium 93. 15)List the basic elements of the pay model.

The pay model contains three basic building blocks: i. The compensation objective, ii. The policies that form the foundation of the compensation system, and iii. The techniques that make up the compensation system. Difficulty: Easy 94.

15-17)Explain the compensation objectives of the pay model. The basic objectives include efficiency, fairness, ethics, and compliance with laws and regulations. Efficiency can be stated more specifically: (1) improving performance, increasing quality, delighting customers and stockholders, and (2) controlling labor costs. The fairness objective calls for fair treatment for all employees by recognizing both employee contributions (e.g., higher pay for greater performance, experience, or training) and employee needs (e.g., a fair wage as well as fair procedures). Ethics means the organization cares about how its results are achieved. Because it is so important, it is inevitable that managing pay sometimes creates ethical dilemmas. Compliance as a pay objective means conforming to federal and state compensation laws and regulations.

If laws change, pay systems may need to change, too, to ensure continued compliance. As companies go global, they must comply with the laws of all the countries in which they operate. Difficulty: Medium 95. 19-20)List and define the different policy decisions of the pay model. Internal alignment refers to comparisons among jobs or skill levels inside a single organization. External competitiveness refers to pay comparisons with competitors.

Employee contribution emphasizes on the pay mix for different employees according to performance and/or seniority. Management means ensuring that the right people get the right pay for achieving the right objectives in the right way.

Difficulty: Medium.