In: Accounting
38. Effective incentive compensation plans must induce individual behavior compatible with increasing the firm's wealth. Deferred compensation is given for
a. short-term performance.
b. long-term incentive.
c. particular actions or extraordinary performance.
d. None of the answers is correct.
39. The expectancy view of motivation recommends
a. improving performance evaluation processes.
b. providing a high probability that behaving as the organization wishes will lead to rewards.
c. creating incentive plans that include stock options.
d. both a and b above.
40. The theory which maintains that people act in ways to obtain the rewards that they desire and prevent the penalties that they wish to avoid is called the
a. agency theory
. b. reward-penalty theory.
c. expectancy theory.
d. mini-max theory.
41. The balanced scorecard is used to tie performance measures to which of the following?
a. organizational goals.
b. short-term objectives only.
c. long-term objectives only.
d. regulatory requirements.
Answer:
38. (b) Long-term incentives
Effective incentive compensation plan has three common characteristics such as cash bonus and profit sharing for short-term performance, deferred compensation for long-term incentive, and special awards for particular actions or extraordinary performance.
39. (d) Both a and b
The expectancy view of motivation recommends two things such as; providing desirable rewards which includes improving performance evaluation and providing a high probability that behaving as the organization wishes will lead to the rewards.
40. (b) Reward and punishment theory
The reward and punishment theory is a method of learning that occurs through rewards and punishments for behavior. This method says that when you are rewarded for doing something you are more likely to do it again.When you are punished for doing something you are less likely to do it again.
41. (a) Organisational goals
The goal of balanced scorecard is to tie business performance to organisational strategy. The balanced scorecard is used to attain objectives and goals of a business or an organisation. It is used to measure and provide feedback to organisations.