In General,which of the Following Is an Incentive Plan Design

question 26

Multiple Choice

In general,which of the following is an incentive plan design consideration?

• A)profitability
• B)the outcome of an employee election about willingness to participate in one or more incentive plans
• C)the level of risk employees will accept in their overall compensation package
• D)workforce unionization

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Definitions:

Ability-To-Pay Principle

The idea that those who have greater income (or wealth) should pay a greater proportion of it as taxes than those who have less income (or wealth).

Marginal Cost

the additional cost incurred to produce one more unit of a good or service.

Marginal Benefit

The added joy or utility one achieves by consuming an additional unit of a product or service.

Cost-Benefit Analysis

is a systematic approach to estimating the strengths and weaknesses of alternatives, used to determine the best option through weighing the cost against benefits.