In the Comparison of the Pay Systems of Two Well-Known

question 48

Multiple Choice

In the comparison of the pay systems of two well-known Japanese companies Toyota and Toshiba, Toyota _____.

• A)places greater emphasis on external market rates
• B)places lesser emphasis on individual-based merit pay
• C)uses far more levels in its structure
• D)places lesser emphasis on individual-based performance pay

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Definitions:

Ronald Coase

A British economist known for his work on transaction costs, property rights, and the theory of the firm.

Negative Externalities

Unintended and unfavourable outcomes or costs imposed on a third party not involved in a transaction or activity.

Taxes

Compulsory financial charges or some other type of levy imposed upon a taxpayer by a governmental organization.

Positive Externality

A benefit that affects a party who did not choose to incur that benefit, often leading to underproduction of the good or service in absence of intervention.