Question 1

_____ means that the employee is paid a given amount regardless of the number of hours worked or quality of the work.

Accepted Answer

A)   Pay level
B)   Nonexemption
C)   Pay policy line
D)   Piecework rate
E)   Salary basisF) A) and E)
G) None of the above

Question 2

Reducing the number of levels in an organization's job structure is known as:

Accepted Answer

A)   outsourcing.
B)   delayering.
C)   rightsizing.
D)   benchmarking.
E)   whistle-blowing.F) A) and D)
G) A) and C)

Question 3

Which of the following is true according to the Walsh-Healy Public Contracts Act of 1936?

Accepted Answer

A)   Under the Walsh-Healy Public Contracts Act, children aged 18 and 19 may not be employed in hazardous occupations defined by the Department of Labor.
B)   Federal contractors must pay their employees at rates at least equal to the prevailing wages in the area.
C)   The overtime rate applies to the hours worked beyond 45 in one week.
D)   Employers must pay a training wage to workers under the age of 15 for a period of up to 60 days.
E)   Organizations can defend themselves against claims of discrimination by showing that they pay the going market rate.F) D) and E)
G) C) and E)

Question 4

The most common approach to pay differentials is to move an employee lower in the pay structure to compensate for increasing costs.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following would act as a market force during the development of a pay structure?

Accepted Answer

A)   Restrictions on child labor
B)   Meeting principles of fairness
C)   Providing equal pay for equal work
D)   Paying atleast the minimum wage established by law
E)   Obtaining human resources in labor marketsF) A) and E)
G) A) and B)

Question 6

A compa-ratio of 1 suggests that actual pay is not consistent with the pay policy.

Accepted Answer

A) True 
 B)False

Question 7

The equity of executive pay does not affect other employees.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is a disadvantage of broad bands?

Accepted Answer

A)   They reduce managers' flexibility in making assignments.
B)   They always result in pay decreases.
C)   They reduce the number of levels in the organization's job structure.
D)   They reduce the opportunities for promoting employees.
E)   They discourage employees from gaining valuable experience through lateral career moves.F) C) and D)
G) A) and D)

Question 9

Which of the following is true about job-based pay structures?

Accepted Answer

A)   The ambiguous definition of a job's responsibilities can contribute to an attitude that some activities "are not in my job description," at the expense of inflexibility.
B)   Their focus on higher pay for higher status can work in favor of efforts of empowerment.
C)   They usually reward desired behaviors, particularly in a rapidly changing environment.
D)   Organizations may avoid change because it requires repeating the time-consuming process of creating job descriptions and related paperwork.
E)   They always encourage innovation and customer service.F) B) and C)
G) C) and D)

Question 10

Economic theory holds that the most profitable pay level,all things being equal,would be:

Accepted Answer

A)   below the market rate.
B)   at the market rate.
C)   above the market rate.
D)   anywhere within (slightly above or slightly below)  the market-rate range.
E)   the pay level that is lower than that of the lowest paying organization.F) None of the above
G) B) and D)

Question 11

A pay policy line:

Accepted Answer

A)   shows the mathematical relationship between the minimum pay and the maximum pay in an organization.
B)   can be generated using a statistical procedure called regression analysis.
C)   requires market-pay-rate data on all jobs in the organization.
D)   can be used to estimate the minimum pay level for a given job evaluation.
E)   reflects the pay structure in the market, which always matches rates in the organization.F) A) and E)
G) A) and D)

Question 12

A drawback of pay rates is that they:

Accepted Answer

A)   increase the administrative burden of managing the compensation system.
B)   result in decreased promotional opportunities for employees.
C)   result in some jobs being underpaid and others being overpaid.
D)   increase the costs of surveying the market.
E)   grouping jobs will result in rates of pay for individual jobs that precisely match the levels specified by the market.F) None of the above
G) A) and D)

Question 13

Pay grades allow rates of pay for individual jobs to be more precisely matched to market rates and the organization's job structure.

Accepted Answer

A) True 
 B)False

Question 14

By combining more assignments into a single layer,organizations give managers more flexibility in making assignments and awarding pay increases which results in:

Accepted Answer

A)   outsourcing.
B)   broad bands.
C)   rightsizing.
D)   benchmarks.
E)   downsizing.F) C) and D)
G) D) and E)

Question 15

What is skill-based pay? What are its advantages and disadvantages?

Accepted Answer

Skill-based pay systems are pay structur...

Question 16

Which of the following statements is true of the FLSA requirements for overtime pay?

Accepted Answer

A)   The overtime rate is one and a half times the employee's hourly rate, excluding any bonuses or piece-rate payments.
B)   Time worked includes only hours spent on production or sales, but not on activities such as attending required classes, cleaning up the work site, etc.
C)   Overtime must be paid whether or not the employer specifically asked or expected the employee to work the extra hours.
D)   Everyone is eligible for overtime pay.
E)   Most workers paid on an hourly basis are exempt and therefore not subject to the laws governing overtime pay.F) C) and E)
G) C) and D)

Question 17

How does equity theory justify the high pay of CEOs?

Accepted Answer

The issue of executive pay is relevant t...

Question 18

A rate of pay for each unit produced is known as:

Accepted Answer

A)   yearly pay.
B)   salary.
C)   hourly wage.
D)   piecework rate.
E)   monthly pay.F) D) and E)
G) B) and D)

Question 19

How do organizations compare actual pay to pay structure?

Accepted Answer

As part of its management responsibility...

Question 20

According to the FLSA,which of the following is most likely a nonexempt employee?

Accepted Answer

A)   CEO
B)   Senior administrative employee
C)   Hourly-paid employee
D)   Executive employee
E)   DirectorF) C) and D)
G) A) and B)

Exam 11: Establishing a Pay Structure

A rate of pay for each unit produced is known as:

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The most common approach to pay differentials is to move an employee lower in the pay structure to compensate for increasing costs.

Correct AnswerverifiedShow Answer

The equity of executive pay does not affect other employees.

Correct AnswerverifiedShow Answer

By combining more assignments into a single layer,organizations give managers more flexibility in making assignments and awarding pay increases which results in:

Correct AnswerverifiedShow Answer

According to the FLSA,which of the following is most likely a nonexempt employee?

Correct AnswerverifiedShow Answer

Which of the following statements is true of the FLSA requirements for overtime pay?

Correct AnswerverifiedShow Answer

A drawback of pay rates is that they:

Correct AnswerverifiedShow Answer

Reducing the number of levels in an organization's job structure is known as:

Correct AnswerverifiedShow Answer

Which of the following is true according to the Walsh-Healy Public Contracts Act of 1936?

Correct AnswerverifiedShow Answer

What is skill-based pay? What are its advantages and disadvantages?

Correct AnswerverifiedSkill-based pay systems are pay structur...View AnswerShow Answer

How does equity theory justify the high pay of CEOs?

Correct AnswerverifiedThe issue of executive pay is relevant t...View AnswerShow Answer

Which of the following is true about job-based pay structures?

Correct AnswerverifiedShow Answer

Economic theory holds that the most profitable pay level,all things being equal,would be:

Correct AnswerverifiedShow Answer

How do organizations compare actual pay to pay structure?

Correct AnswerverifiedAs part of its management responsibility...View AnswerShow Answer

Pay grades allow rates of pay for individual jobs to be more precisely matched to market rates and the organization's job structure.

Correct AnswerverifiedShow Answer

_____ means that the employee is paid a given amount regardless of the number of hours worked or quality of the work.

Correct AnswerverifiedShow Answer

Which of the following is a disadvantage of broad bands?

Correct AnswerverifiedShow Answer

A pay policy line:

Correct AnswerverifiedShow Answer

Which of the following would act as a market force during the development of a pay structure?

Correct AnswerverifiedShow Answer

A compa-ratio of 1 suggests that actual pay is not consistent with the pay policy.

Correct AnswerverifiedShow Answer

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Skill-based pay systems are pay structur...
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The issue of executive pay is relevant t...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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As part of its management responsibility...
View Answer

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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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