An ESOP-Based Incentive Compensation Plan

question 96

Multiple Choice

An ESOP-based incentive compensation plan:

• A) is based entirely on productivity and quality gains.
• B) resembles an Improshare plan that distributes corporate savings to workers.
• C) is based on the entire company's performance and rewards employees with stock.
• D) combines the best features of an individual-based plan and a team-based incentive plan.

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Definitions:

Comparable Magnitude

A level of similarity or equivalence in size, impact, or importance between two or more elements.

Distributive Bargaining

A negotiation process focused on dividing a fixed amount of resources between parties.

Bargaining Range

The spectrum or zone between the opening positions of negotiating parties where an agreement is feasible.

Concessions

Compromises made by one or more parties in a negotiation, where they agree to relinquish certain demands or positions.