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Homework answers / question archive / 1)Kazuri Inc
1)Kazuri Inc., a manufacturing company, bases employees' pay entirely on market forces. In this case, which of the following is a practical drawback faced by the company?
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Employees might conclude that the pay rates are unfair.
Supervisors of the company will expect to receive lower pay because of less responsibility.
The highly paid employees will likely be dissatisfied because of more work.
The managers will participate in rotation of responsibilities because they receive lower pay.
All employees will be categorized as exempt employees.
2 Which of the following will most likely be a result of using an unplanned approach, in which each employee's pay is independently negotiated?
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dissatisfied employees
equal pay distribution
rates that are stable
easy employment
cost control
3 Which of the following statements is true about skill-based pay?
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Skill-based pay provides a way to ensure that employees can use their new skills.
Gathering market data about skill-based pay is easy.
Skill-based pay ensures that the employer pays the employee for learning skills that benefit the employer.
Skill-based pay does not necessarily provide an alternative to the bureaucracy and paperwork of traditional pay structures.
Skill-based pay does not require records related to skills, training, and knowledge acquired.
4 The Walsh-Healy Public Contracts Act of 1936
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requires that a lower "training wage" be paid to workers under the age of 20 for a period of up to 90 days.
mandates that employers pay higher wages for overtime, defined as hours worked beyond 40 hours per week.
covers construction contractors that receive more than $2,000 in federal money.
requires general contractors performing services on prime contracts in excess of $2,500 to pay service employees in various classes no less than the prevailing local wage rates.
covers all government contractors receiving $10,000 or more in federal funds.
5 Executive pay has drawn public scrutiny in recent years. Which of the following statements best explains the reason?
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Top executives' pay is much higher than average workers' pay.
Most of the top executives' pay is in the form of a salary.
Top executives come under the category of exempt employees.
Top executives are paid in the form of commissions.
Executives are denied short-term or long-term incentives with their pay.
6 Triano Brothers, an insurance firm, follows an administrative procedure for measuring the relative worth of its jobs. The organization does this by assembling and training a committee consisting of people familiar with the jobs. The committee includes a human resource specialist and, if the budget permits, an outside consultant is hired. Which of the following is exemplified in this scenario?
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job rotation
job evaluation
merit pay system
job enrichment
work structure
7 A pay policy line
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shows the mathematical relationship between the minimum pay and the maximum pay in an organization.
can be generated using a statistical method called regression analysis.
requires market-pay-rate data on all jobs in the organization.
can seldom provide information on the market pay level for a given job evaluation.
reflects the pay structure in the market, which always matches rates in the organization.
8 Das Work and Edge Tech are electronics manufacturing companies competing to serve the same customers. The labor-related expense per product for Das Work is $30 higher than that for Edge Tech. However, Das Work makes more profits than Edge Tech. In this case, which of the following actions has contributed to the profits made by Das Work?
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It produces high quality goods and charges more for these products than competitors.
It does not provide overtime pay to employees who work more than 40 hours in one week.
It has recently introduced the comparable-worth policy for employees.
It provides free home delivery of purchased goods.
It has a company website where customers can purchase goods online.
9 Which of the following provisions is included in the Fair Labor Standards Act (FLSA)?
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personal finance
minimum wage
wage discrimination
environmental hazards
retirement plans
10 Which of the following is a drawback of setting pay rates based strictly on a pay policy line?
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It increases the administrative burden of managing the compensation system.
Employees have difficulty interpreting regression analysis.
The estimated pay for a job may not reflect conditions in the labor market.
It increases the costs of surveying the market.
It groups jobs, which will result in rates of pay for individual jobs that precisely match the levels specified by the market.
11 Spark Inc., a manufacturing company, hires employees ranging in age from 14 to 25. Which of the following practices by Spark would ensure that it complies with child labor laws?
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The employees are all paid the same amount.
The teenage employees earn a training wage for the first year.
Only the workers over 20 earn overtime pay.
All the employees have part-time schedules.
The employees aged 14 and 15 work only in office jobs and for limited time periods.
12 Which of the following statements is true about the Consumer Price Index (CPI)?
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The CPI helps organizations in the product markets decide an upper limit on the pay they will offer.
Following and studying changes in the CPI helps employers prepare for changes in the demands of the labor market.
The CPI helps organizations lure top-quality employees.
The CPI helps control labor markets' demand for pay increases.
The CPI helps organizations to compete with companies in other industries that hire similar employees.
13 Compa-ratio
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is defined as the ratio of average pay to the midpoint of the pay range.
is defined as the ratio of the average pay for the grade divided by the minimum pay for the grade.
can range from 0 to 100 percent.
uses data from market-pay surveys.
measures the degree to which new skills learnt are consistent with the increases in pay.
14 Which of the following statements is true about the Fair Labor Standards Act (FLSA)?
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The overtime rate under the FLSA is two and a half times the employee's hourly rate.
The FLSA permits federal contractors to pay less than the prevailing wage rate.
The FLSA permits a subminimum training wage equal to 95% of the minimum wage.
Nonexempt employees are covered by FLSA and include most hourly workers.
Under the FLSA, executive, professional, and administrative employees are considered nonexempt employees.
15 Pentrall, a healthcare company, provides a lower training rate to its employees belonging to the age group of 18 to 19 years. The rate is applicable for a period of 90 days. In this case, which of the following laws will justify the organization's decision to pay the lower pay?
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laws governing equal employment opportunity
Fair Labor Standards Act (FLSA) provisions for minimum wage
Fair Labor Standards Act (FLSA) provisions for overtime
laws governing prevailing wages
Fair Labor Standards Act (FLSA) provisions for child labor
16 The Davis-Bacon Act of 1931
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requires that a lower "training wage" be paid to workers under the age of 20 for a period of up to 90 days.
mandates that employers pay higher wages for overtime, defined as hours worked beyond 40 hours per week.
requires general contractors performing services on prime contracts in excess of $2,500 to pay service employees in various classes no less than the wage rates found prevailing in the locality.
covers all government contractors receiving $10,000 or more in federal funds.
covers construction contractors that receive more than $2,000 in federal money.
17 Which of the following statements is true according to the Davis-Bacon Act of 1931 and the Walsh-Healy Public Contracts Act of 1936?
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Under these laws, individuals aged 18 and 19 may not be employed in hazardous occupations defined by the Department of Labor.
Federal contractors must pay their employees at rates at least equal to the prevailing wages in the area.
The overtime rate applies to the hours worked beyond 45 in one week.
Employers must pay a training wage to workers under the age of 15 for a period of up to 60 days.
Organizations can defend themselves against claims of discrimination by showing that they pay the going market rate.
18 Which of the following is the result of combining more assignments into a single layer, thus giving managers more flexibility in making assignments and awarding pay increases?
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outsourcing
broad bands
rightsizing
benchmarks
downsizing
19 Hamish Life, an insurance company, defines the difference in pay between an entry-level recruiter and an entry-level assembler, as well as the difference between an entry-level recruiter, an HR manager, and the vice president of the human resource department. Which of the following is being exemplified in this scenario?
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straight piecework plan
job structure
merit pay system
pay differential
balanced scorecard
20 Which of the following is a drawback of a minimum wage in terms of social policy?
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It assumes people will take differences in pay into account when they choose a career.
It is one and a half times the employee's usual hourly rate.
It applies only to the hours worked beyond 40 in one week.
It places the employer at an economic disadvantage relative to employers that pay the living wage.
It tends to be lower than the earnings required for a full-time worker to rise above the poverty level.
21 Pay policies are one of the most important human resource tools for
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reducing competition in the product market.
automating routine activities.
persuading customers that high quality is worth a premium price.
making decisions about product pricing.
encouraging desired employee behaviors.
22 According to _____, people measure outcomes such as pay in terms of their inputs.
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expectancy theory
equity theory
retributive justice theory
progressive justice theory
economic theory
23 Which of the following sentences best describes a situation that comparable-worth policies were designed to address?
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In a manufacturing company, there are no female managers.
A consumer products company has been sued for racial discrimination.
An agency works with a supermarket's HR department to design a job that could be held by people with mental disabilities.
In a city government, positions mostly held by women pay less than positions mostly held by men.
At a utility company, jobs that involve physical strain and danger pay more than office jobs.
24 Caroline, a researcher, believes that an organization needs to plan what they will pay employees in each job. Mark, her colleague, argues that an employee's pay should be independently negotiated. Which of the following statements will weaken Mark's argument?
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An unplanned approach will likely result in unfairness and dissatisfaction among the employees.
Most of the employees prefer planned pay because negotiation with the management takes time.
Independently negotiated pay will increase the workload and rivalry among the employees.
When the pay is planned by the organization, it creates more employment opportunities.
The pay structure is the same for both an entry-level and a manager-level employee if it has been independently negotiated.
25 Although labor and product markets limit organizations' choices about pay levels, there is a range within which organizations can make decisions. The size of this range depends on the
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minimum and maximum wages fixed by the government.
pay of federal contractors.
organization's competitive environment.
quality of employees.
organization's global reputation.
26 An organization's choices about _____ are limited by its response to the economic forces of product markets and labor markets.
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pay rates
pay structure
pay differentials
pay grades
pay ranges
27 Overlapping _____ give the organization more flexibility in transferring employees among jobs, because transfers need not always involve a change in pay.
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pay rates
pay ranges
pay policies
pay differentials
pay ranks
28 Blyrie Pharma is a pharmaceutical company based in Alabama. Blyrie Pharma expects its employees to work long hours and achieve increased production rates. Employees earn one and a half times the usual hourly rate for working more than 40 hours in one week. Which of the following laws is Blyrie Pharma abiding by in this scenario?
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laws governing equal employment opportunity
Fair Labor Standards Act (FLSA) of minimum wage
Fair Labor Standards Act (FLSA) of overtime
laws governing prevailing wages
product market laws
29 John and Lisa hold the same position at Flyberry Electronics. However, John earns more than Lisa. In the context of pay structure, which of the following justifies the organization's decision to pay John more than Lisa?
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John works the night shift, and night hours are less desirable for most workers.
John is a U.S. citizen; therefore his pay should be higher than that of non-Americans.
Lisa is pregnant; therefore her productivity is assumed to be lower.
John is physically disabled; therefore he should be paid more than Lisa.
Lisa lives in a location where living expenses are higher.
30 Which of the following is a set of possible pay rates defined by a minimum, maximum, and midpoint of pay for employees holding a particular job?
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pay grade
pay range
pay differential
compa-ratio
compensation differential
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