The Most Common Type of Incentive Plan, Which Compares a Worker's

question 91

Multiple Choice

The most common type of incentive plan, which compares a worker's performance against an objective standard with pay determined by his or her own performance is known as a(n) :

• A) profit-sharing plan.
• B) stock plan.
• C) gainsharing plan.
• D) individual plan.
• E) merit pay system.

---

Definitions:

Performance Evaluation

The process of assessing the effectiveness, efficiency, and productivity of an individual, group, or entity.

Cost Center

A department or segment within an organization that does not directly contribute to profit but incurs costs.

Total Costs

The sum of all expenses incurred by a business in producing goods or services, including fixed and variable costs.

Specified Output

A defined amount or quality of work that must be produced, typically set as a target or requirement.