Which of the Following Is True About Gain-Sharing Pay Plans

question 41

Multiple Choice

Which of the following is true about gain-sharing pay plans?

• A)They foster competition among employees, instead of cooperation.
• B)They are simple to administer.
• C)They do not bring about clear performance-reward links.
• D)They ensure that payouts occur only when a company's financial performance is good.
• E)They help increase employees' knowledge of business.

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Definitions:

Subordinated Debt

Debt with a lower priority for the payment of interest and principal than other (senior) debt.

Senior Debt

Senior debt is a loan or bond that takes priority over other unsecured or junior debt owed by the issuer.

Convertible

A type of financial security, such as a bond or preferred stock, that can be converted into a specified amount of another type, typically common stock, at the holder's option.

Bond Yields

The amount of return an investor realizes on a bond, usually expressed as a percentage of the bond's value.