Which of the Following Statements About Incentive Pay Ceilings Is

question 9

Multiple Choice

Which of the following statements about incentive pay ceilings is true?

• A) Incentive ceilings can be used to protect against windfalls
• B) Incentive ceilings make a firm's maximum potential sales compensation expense more predictable and controllable
• C) Firms in relatively low paying industries are more likely to impose incentive ceilings than those in high-paying industries
• D) Incentive ceilings are used to ensure that top-performing salespeople will not make such high earnings that other employees suffer resentment and low morale
• E) All of the above statements about incentive ceilings are true

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Definitions:

Further Up

Used to refer to stages or positions that are higher in a hierarchy, supply chain, or process, often implicating more responsibility or control.

Push Processes

Supply chain processes that operate on forecast demand, pushing products through the supply chain to the end user.

Customer Demand

The quantity of products or services that consumers are willing and able to purchase at various prices during a specified period.

Available Capacity

The maximum output or the total amount of work that a facility, employee, or machine can produce or accommodate in a specific period.