Which of the Following Statements Is/are True Regarding Compensation

question 118

Multiple Choice

Which of the following statements is/are true regarding compensation?
(A) Fixed compensation is generally not linked to measured performance; i.e., it is independent of measured performance.
(B) Properly designed management control systems have contingent compensation items but not fixed compensation items.

• A) Only A is true.
• B) Only B is true.
• C) Both of these are true.
• D) None of these is true.

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Definitions:

Expected Value

The long-run average or mean value of random variables, weighted by their probabilities, representing the expected outcome of a random event.

Linear Relationship

A direct proportionality between two variables in which the change in one variable is directly proportional to the change in another, represented graphically as a straight line.

Relationship

A connection, association, or interaction between two or more variables, where changes in one variable affect the other(s).

Independent Variables

Refers to the inputs or predictors in a statistical model that are manipulated or selected by the researcher to determine their effect on the dependent variable.