Multiple Choice Answers

Question 1

Financial rewards include direct payments plus indirect payments in the form of:
A. individual equity.
B. corporate compensation.
C. spot awards.
D. employee benefits.
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Question 2
If pay systems are to accomplish the objectives set for them, ultimately they must be perceived as:
A. adequate and equitable.
B. generous and timely.
C. immediate and fair.
D. relevant and competitive.
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Question 3

Which of the following laws established the first national minimum wage?
A. Davis-Bacon Act
B. Fair Labor Standards Act
C. Walsh-Healy Act
D. McNamara-O’Hara Service Contract Act
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Question 4

Which act states that overtime is required only for hours worked in excess of 40 per week, not 8 per day, as previously?
A. Federal Labor Relations Act
B. Labor Management Reporting and Disclosure Act
C. McNamara-O’Hara Service Contract Act
D. Defense Authorization Act
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Question 5

Common job characteristics that an organization is willing to pay for, such as skill, effort, responsibility, and working conditions are termed:
A. workload standards.
B. benchmark jobs.
C. compensable factors.
D. ESOPs.
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Question 6

Relevant labor markets should consider __________ as well as product-market competitors.
A. workload standards
B. internal equity
C. geographical boundaries
D. survey data
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Question 7

Alternatives to pay systems based on job evaluation include all of the following EXCEPT:
A. education-based pay.
B. skill-based pay.
C. market-based pay.
D. knowledge-based pay.
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Question 8

A narrowing of the ratios of pay between jobs or pay grades in a firm’s pay structure is pay:
A. secrecy.
B. compression.
C. security.
D. inequality.
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Question 9

One solution to the problem of pay compression is to institute:
A. equity adjustments.
B. merit-pay increases.
C. compensation concentration.
D. salary caps.
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Question 10

The fact that past merit payments are incorporated into an individual’s base salary allowing formerly productive employees to slack off is known as:
A. merit allowance.
B. a disincentive.
C. a union contract.
D. the annuity problem.
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Question 11

An employer awarding an employee’s exceptional performance with a small, one-time bonus shortly after the noteworthy actions is a __________ bonus.
A. lump-sum
B. spot
C. surprise
D. competency-based
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Question 12

Which law offers full coverage for retirees, dependent survivors, and disabled persons insured by 40 quarters of payroll taxes on their past earnings or earnings of heads of households?
A. Federal Unemployment Tax Act
B. Social Security Act
C. Workers’ compensation
D. Employee Retirement Income Security Act
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Question 13

The benefits of this act are based on a percentage of average weekly earnings and are available for up to 26 weeks.
A. Administrative Procedure Act
B. Social Security Act
C. Balanced Budget Act
D. Federal Unemployment Tax Act
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Question 14

Which act covers private-sector employees over age 21 enrolled in noncontributory (100% employer-paid) retirement plans who have one year’s service?
A. COBRA
B. HIPAA
C. ERISA
D. ADA
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Question 15

The anti-discrimination rule holds that employers can obtain tax advantages only for those benefits that do not discriminate in favor of:
A. white males.
B. stockholders.
C. highly compensated employees.
D. younger employees.
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Question 16

Plans are known as __________ when the employees share in the cost of the premiums.
A. share-based
B. contributory
C. distributive
D. peer participating
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Question 17

An individual or group health plan that provides or pays the cost of medical care may not use or disclose __________ except with the consent or authorization of the individual in question.
A. salary information
B. cost of insurance premiums
C. spousal information
D. protected health information
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Question 18

__________ programs typically provide a core of basic life coverage and then permit employees to choose greater coverage.
A. Flexible benefit
B. Defined-benefit
C. Defined-contribution
D. Point-of-service
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Question 19

Which of the following is NOT an area of payment covered by workers’ compensation?
A. Payments to employers while injured workers are recovering
B. Payments to replace lost wages
C. Medical treatment and rehabilitation costs
D. Retraining to perform a different type of work
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Question 20

The type of private pension plan in which an employer promises to pay a retiree a stated pension is a:
A. defined-benefit plan.
B. defined-performance plan.
C. defined-retirement plan.
D. defined-contribution plan.