A Company Has a Merit Pay Plan Based on the Relative

question 27

Multiple Choice

A company has a merit pay plan based on the relative performances of workers teams. Each worker is a team gets the same wage as other team members, but those in more productive teams get higher wages. Which of the following would NOT explain why this incentive might be better than other methods for motivating workers to work harder?

• A) If a worker works harder, it increases the productivity of other team members.
• B) If a team works harder, it does not affect the productivity of other teams.
• C) One worker can easily sabotage the productivity of other workers.
• D) One team can easily sabotage the productivity of other teams.

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Definitions:

Joint Operation

A business arrangement where two or more parties share control and management of a project or business.

Joint Venture

A business arrangement where two or more parties agree to pool their resources for the purpose of accomplishing a specific task or business activity.

Rights To Net Assets

The entitlements that equity holders have to a company's assets after all liabilities have been settled.

Specific Assets And Liabilities

Items on a company's balance sheet that are clearly identified and quantified, including cash, inventory, debt, and equity.