COMMERCE 4BE3 Study Guide - Quiz Guide: Merit Pay, Performance Appraisal, Piece Work

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Chapter 5 – MindTap
1. In what way are merit pay and special-purpose incentives similar to each other?
a. They fit human relations organizations.
b. They are types of organizational performance pay.
c. They are always used in combination with base pay.
d. They are based on appraisals of overall employee performance.
2. A farmer estimates that a labourer should be able to pick 12 boxes (250 kg) of apples in an
eight-hour shift. Wage rates in the area place labourer daily rates at $160.00 per day for an eight-
hour shift. Based on this information, what is the straight piece rate paid by the farmer?
a. $10.00 per box
b. $12.50 per box
c. $13.33 per box
d. $20.00 per box
3. What is a possible drawback with using commissions?
a. Commissions serve as a source of feedback and as a self-correcting
mechanism.
b. Commission systems are fairly complex to establish.
c. Commissions increase sales.
d. Commissions produce intense competition among salespeople.
4. Which statement regarding merit bonuses can be seen as advantageous from an employer's
perspective?
a. Merit bonuses do not represent a permanent increase to base pay;
hence, good employee performance is needed every year.
b. Merit bonuses cannot be used in conjunction with a merit raise system.
c. Merit bonuses are usually provided to teams; hence, team work is promoted
in classical organizations.
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d. Once established, the percentage of merit bonuses is static from year to
year; hence, it is fairly easy to administer.
5. An accurate performance appraisal process identifies several so-called "suitable
conditions" required to facilitate the introduction of individual merit pay. Which of the
following is NOT one of those suitable conditions?
a. There is an accurate performance appraisal process across the organization.
b. Individuals' performance tends to be fairly equal across the organization.
c. There is a management strategy that is congruent with individual merit pay.
d. Employees have a large degree of control over their performance.
6. As the VP of human resources, you have determined that greater teamwork is required in
your organization. Which pay plan would you introduce if greater teamwork is your goal?
a. commission pay
b. merit pay
c. goal sharing
d. special purpose incentives
7. If an employee is granted access stock options plans, they will usually only exercise their
option if the option price is higher than the stock market price.
a. True
b. False
8. A performance unit plan provides a long-term incentive in which the bonus amounts are
expressed in units for which the monetary value will fluctuate, depending on degree of goal
accomplishment. What is this performance unit plan a part of?
a. direct pay reward
b. a stock option plan
c. a long term incentive plan
d. a commission reward plan
9. Which plan encourages employees "to think like owners" and can help create citizenship and
membership behaviours?
a. employee stock plans
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