Which of the Following Is Not an Advisable Criterion for an Effective

question 106

Multiple Choice

Which of the following is not an advisable criterion for an effective incentive plan?

• A)The rewards are believable.
• B)The rewards are linked to performance.
• C)The rewards satisfy individual needs.
• D)The rewards require rarely attainable performance.
• E)The rewards are agreed on by the manager and employees.

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Definitions:

Equity Method

An accounting technique used by firms to assess the profits earned through their investments in other companies, recording these investments at cost and subsequently adjusting them to reflect the investee's changes in net assets.

Investment Account

An account held at a financial institution that contains securities, cash, and other assets managed for investment purposes.

Affiliate's Reported

The financial outcomes or other significant reports presented by an entity in which another company holds an interest but does not have full control or ownership.

Trading Securities

Financial assets such as stocks or bonds, held by a firm for the purpose of reselling them in the short term to profit from price movements.