Two Employees Are Performing the Same Job and Are Required

question 25

Multiple Choice

Two employees are performing the same job and are required to meet the same standards; however, one employee makes $2 per hour more for the job. According to which theory will the lower paid employee be unsatisfied because he feels he is being treated unfairly in comparison to his coworker?

• A) McClelland's needs theory
• B) Equity theory
• C) Expectancy theory
• D) Consistency theory

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Definitions:

Cash Inflows

The total amount of money being transferred into a business, usually from operating, investing, and financing activities.

Discount Rate

The rate applied within discounted cash flow analysis for assessing the present worth of forthcoming cash flows.

Net Present Value

A method of evaluating investments by calculating the difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Initial Investment

The initial amount of money spent to start a project, investment, or business, often including costs such as purchasing equipment, property, or technology.