The CEO of Your Company Wants to Move to a Pure

question 36

Multiple Choice

The CEO of your company wants to move to a pure market pricing approach to compensating all the employees.She argues that it is foolish to pay more for any resource (including human resources) than they are worth on the open market.She argues that a pure market pricing approach would be the most efficient use of organizational funds.It is her idea to review the market price for each job in the company annually,and revise the employees' pay up or down as indicated.She knows this is an unconventional idea,but she is convinced it would work.You make all the following arguments EXCEPT

• A) a pay structure based entirely on market pricing would be hard to defend in court against charges of discrimination.
• B) employees' pay may fluctuate wildly from year to year.
• C) it will not be possible to find pay survey data for jobs that are unique to your company.
• D) for many jobs there is little pay survey data that is gathered in a methodologically-sound manner.

Understand how rational decisions are made by weighing marginal benefits against marginal costs.

Grasp the impact of incentives on individual and economic choices.

Understand the fundamental role of utilities in economic theory.

Acknowledge that using resources for one purpose reduces their availability for other purposes.

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Definitions:

Thymine

One of the four nucleotide bases of DNA, paired with adenine, and responsible for carrying genetic information.

Guanine

One of the four main nucleobases found in DNA and RNA, which pairs with cytosine and is essential for DNA replication and cellular function.

Polygenic Traits

Characteristics or traits that are influenced by multiple genes rather than a single gene, contributing to the phenotype's complexity.

Genes

Biological units of heredity located in our cells that dictate physical and some behavioral traits.