True / False Questions
1. Pay plans are typically used to energize, direct, or control employee behavior.
2. The reinforcement theory to compensation management suggests that managers pay at- or below-market wages.
3. Pay and benefits are examples of intrinsic rewards.
4. While the agency theory has value in the analysis and design of managerial compensation, it is not applicable to nonmanagerial compensation.
5. Different pay systems appear to attract people with different personality traits and values.
6. The performance motivational effects of either profit sharing or gainsharing are likely to be greater in smaller firms or units than in larger organizations or units.
7. Incentive pay refers to linking annual pay increases to performance appraisal ratings.
8. One disadvantage of merit pay is its inability to define and reward a broad range of performance dimensions.
9. Under merit pay, the flow of feedback tends to be multidirectional, from supervisor, peers, and subordinates to the employee.
10. An employee's assessment of the fairness of his or her compensation based on the amount received is referred to as distributive fairness.
1