After Reviewing Pay Ranges for Your Organization,you Realize a Significant

question 10

Multiple Choice

After reviewing pay ranges for your organization,you realize a significant number of pay ranges do not overlap or do not connect.For example,the maximum of the pay range for pay grade number 2 is $50,000 and the minimum range for pay grade number 3 is $60,000.00.What is a potential root cause of this issue?

• A) Ranges are too narrow and/or there are not enough pay grades.
• B) An equal approach method was used to establish pay grades.
• C) An equal percentage method was used to establish pay grades.
• D) Poor benchmark jobs were used to establish pay grades.

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Definitions:

Current Dollars

A term referring to the value of a monetary unit, such as a dollar, in terms of its purchasing power at the current time, not adjusted for inflation.

Time Value

The idea that money currently in hand is valued higher than an identical sum to be received in the future because of its ability to generate earnings.

Present Value

The present value of a sum of money to be received in the future, or a series of future cash flows, calculated using an agreed-upon rate of return.

Earnings Rate

The rate at which a company or investment generates income, typically expressed as a percentage of the investment or capital.