Which of the Following Compensation Policies Is Most Likely to Enhance

question 19

Multiple Choice

Which of the following compensation policies is most likely to enhance a firm's ability to pursue a low-cost strategy?

• A) awarding employees bonuses based on the total amount of goods produced
• B) awarding employees bonuses based on customer comment cards
• C) awarding employees bonuses that are equal to 50% of the total cost savings achieved based on employee suggestions and initiatives
• D) awarding employees bonuses based solely on how long they have been employed with the company

---

Definitions:

Behaviors

Observable actions or reactions of an individual, often in response to the environment or stimuli.

Groupthink

A psychological phenomenon that occurs within a group of people in which the desire for harmony or conformity in the group results in an irrational or dysfunctional decision-making outcome.

Fundamental Attribution Error

The tendency to overestimate the effect of personality or disposition and underestimate the effect of the situation in explaining social behavior.

Self-Serving Bias

A common tendency for individuals to attribute their successes to internal factors while blaming external factors for their failures.