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Regulatory Environments for Compensation Programs Questions and Answers

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Question 1

What happens to the marginal cost if revenue accelerates slower than variable costs but fixed costs remain the same?

Options:

A.

It remains the same.

B.

It decreases because variable costs are increasing.

C.

It increases at the same rate as variable costs.

D.

It becomes increasingly higher as revenues increase.

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Question 2

The Delta Company has experienced increased turnover in the past two years. Data from exit interviews indicate that most of those leaving did so for better opportunities and higher compensation. If Delta pays at the highest percentile of the market for their peer group, what data analysis should they do?

Options:

A.

Additional quantitative analysis to determine whether pay rates are truly competitive or existing data are unreliable

B.

Qualitative data collection to talk to key stakeholders and employees and determine whether the exit interviews accurately reflect their concerns

C.

Qualitative data collection in the form of an employee survey with questions about employee satisfaction with pay levels

D.

No additional data analysis is needed. Delta should increase pay rates based on the existing data to decrease turnover.

Question 3

Which of the following scenarios best describes a contract worker?

Options:

A.

A technician who works a scheduled shift and performs tasks as assigned according to specifications.

B.

A computer programmer who telecommutes, uses her own equipment and works for multiple employers

C.

An accounts payable specialist who works at the company site utilizing an internal A/P system and pays vendors according to company procedures.

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