Which of the Following Statements Is TRUE of Cost-Of-Living Adjustments

question 32

Multiple Choice

Which of the following statements is TRUE of cost-of-living adjustments (COLAs) ?

• A) COLAs are provided to employees only if the company makes a profit.
• B) The value of the COLA changes from employee to employee based on performance.
• C) The majority of collective bargaining agreements provide for monthly COLA adjustments.
• D) The value of the COLA is based on the consumer price index (CPI).

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Definitions:

Benchmarking

The practice of evaluating one's company operations and performance indicators against the highest standards in the industry or the optimal practices observed in other firms.

External Comparisons

The process of evaluating oneself, one's abilities, achievements, or conditions in relation to others.

Current Performance

The recent or ongoing level of effectiveness and achievement demonstrated by an individual or organization.

Qualitative Forecasting

A forecasting method that uses expert opinions and other non-quantifiable information to predict future events.