Megan Graduated from College Three Years Ago and Has Been

question 5

Multiple Choice

Megan graduated from college three years ago and has been working at Sterba Inc. ever since. A conscientious employee, she has consistently received good performance evaluations. She recently found out that a younger colleague, who was just recruited to her team, is drawing a higher salary than she is for doing the same type of work.
-Based on the equity theory, which of the following, if true, would strengthen the argument that Megan is trying to gain a sense of equity by distorting her perception of herself?

• A) She thinks that her colleague is paid more because she is an Ivy League graduate.
• B) She believes that she is less capable than her colleague.
• C) She assumes that her colleague received a higher package due to changes in industry standards.
• D) She believes that her salary is not commensurate with her skills and experience.
• E) She believes that she is doing a lot better career-wise compared to the people with whom she graduated.

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Definitions:

Market Demand

The total quantity of a good or service that all consumers in a market are willing and able to purchase at various prices during a specified period of time.

Residual Dividend Policy

A strategy where dividends are paid to shareholders after all project capital needs are met.

Debt-Equity Ratio

A measure of a company's financial leverage, calculated by dividing its total liabilities by shareholders' equity.

Capital Projects

Large, long-term investments undertaken by a company or government to create, expand, or improve physical assets such as buildings, infrastructure, or equipment.