A Study by Peter Cappelli and Peter Sherer on the Effects

question 6

Multiple Choice

A study by Peter Cappelli and Peter Sherer on the effects of two-tier wage plans has found that:

• A)lower-paid employees were less satisfied on average than higher-paid employees.
• B)employees in the lower tier had lower comparison standards than those in the higher tier.
• C)all employees were equally satisfied, irrespective of they pay.
• D)lower-paid employees remain dissatisfied until they move into the higher-paying tier.
• E)only the actual pay and not the comparison standard influences employee attitudes.

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Definitions:

Dollar-Weighted Return

A measure of an investment's return, taking into account the timing and size of cash flows into and out of the investment.

Internal Rate of Return

An estimate of the profitability of potential investments, calculated as the rate of return that sets the net present value of all cash flows (both positive and negative) from the investment equal to zero.

Holding-Period Return

The total return received from holding an asset or portfolio of assets over a specified period, including interest, dividends, and capital gains.

Treasury Bill

Short-term government securities issued at a discount from the face value and maturing at par, used to finance government spending.