Which of the Following Is a Disadvantage of Using an Above-Market

question 47

Multiple Choice

Which of the following is a disadvantage of using an above-market compensation strategy?

• A) It encourages voluntary turnover among employees.
• B) A firm using this strategy incurs high labor costs.
• C) It hinders a culture of elitism and competitive superiority.
• D) Employees in firms using this strategy experience external inequity.

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Definitions:

Dividend Payments

Disbursements made by a corporation to its shareholders, usually in the form of cash or stock.

Land

A real estate property, referring to the solid part of the earth's surface that can be owned, bought, or sold.

Financing Activities

Transactions that result in changes in the size and composition of the equity capital and borrowings of a company.

Dividend Payments

Distributions of a portion of a company's earnings to its shareholders, typically in the form of cash or additional stock.