Which of the Following Is NOT Characteristic of a Compensation

question 53

Multiple Choice

Which of the following is NOT characteristic of a compensation and reward system designed to help drive successful strategy execution?

• A) Tying incentives to performance outcomes directly linked to good strategy execution and financial performance
• B) Keeping the time between achieving the target performance outcome and the payment of the reward as short as possible
• C) Making sure that the performance targets that each individual or team is expected to achieve involve outcomes that the individual or team can personally affect
• D) Providing generous rewards for people who turn in outstanding performances
• E) Offering rewards that amount to 3 percent of an employee's total compensation

---

Definitions:

Future Transaction Value

The predicted or estimated financial value of a transaction that will occur at a later date, often used in forecasting and budgeting.

Current Market Value

The present value at which an asset can be bought or sold in a current transaction between willing parties.

Realizable Future Value

The expected market value of an asset in the future, considering factors like inflation, interest rates, and market demand.

Marketable Debt

Debt securities that are readily available for purchase and sale in the public market.