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WorldatWork Regulatory Environments for Compensation Programs Sample Questions:
1. What do profits, equity and debt all have in common?
A) They all incur the same costs to the business.
B) They are all sources of capital.
C) Nothing. Each of these is a different financial metric.
D) They are all reported on the balance sheet.
2. Upon which criterion are step increases typically based?
A) Skills
B) Market adjustment
C) Individual performance
D) Longevity
3. If a company has a higher percentage of employees with fixed compensation than variable compensation, what happens as revenues increase?
A) Compensation costs eventually decrease as a percent of revenue, increasing profit growth.
B) Compensation costs and revenue increase at approximately the same rate.
C) Compensation costs remain the same as a percent of revenue until variable compensation costs exceed fixed compensation costs.
D) Compensation costs eventually stabilize and become a consistent percent of revenue.
4. Which of the following combines traditionally segregated time off and leave programs into one policy covering a single block of time?
A) Personal leave
B) Severance allowances
C) Sabbatical
D) Paid time off (PTO) bank
5. What type of equity incentive gives employees the right to purchase company shares at a specified price?
A) Stock/share grants
B) Performance units
C) Restricted stock/shares
D) Stock/share options
Solutions:
| Question # 1 Answer: B | Question # 2 Answer: D | Question # 3 Answer: A | Question # 4 Answer: D | Question # 5 Answer: D |
