Which Part of a Pay Plan Is Designed to Motivate

question 6

Multiple Choice

Which part of a pay plan is designed to motivate employees?

• A) Benefits
• B) Base pay
• C) Shift and location adjustments
• D) Variable pay

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Definitions:

Equity Financed

The method of raising capital through the sale of shares in a company.

Retained Earnings

The portion of a company’s profit that is held back and not distributed to shareholders as dividends, to be reinvested in the business.

EBIT

Earnings Before Interest and Taxes - an indicator of a company's profitability that calculates income without tax expenses and interest expenses.

Straight Line

A method of allocating the cost of a tangible asset over its useful life in equal installments.