Which of the Following Is NOT a Weakness of Profit-Sharing

question 52

Multiple Choice

Which of the following is NOT a weakness of profit-sharing plans?

• A) They cause intense competition at the individual employee level.
• B) Profits shared may be affected by external economic factors.
• C) The line of sight between reward and individual performance is weak.
• D) The performance of other firms on the stock market may affect profits.

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Definitions:

Total Income

The sum of all wages, salaries, profits, interest payments, rents, and other forms of earnings received by an individual or entity in a given period.

Regressive Tax

A tax system in which the tax rate decreases as the taxable amount increases, disproportionately burdening lower-income individuals.

Sales Tax

A tax imposed on sales of goods and services, typically calculated as a percentage of the selling price.

Tax Rate Structure

The system or design of tax rates, which can be progressive, regressive, or proportional, determining how taxes are applied based on income or other factors.