21) Balancing equity is most likely difficult because:

A) EEOC regulations are extensive and complicated.

B) internal and external equity often oppose one another.

C) open pay employers strive primarily for internal equity.

D) managers prefer focusing on establishing external equity.

22) An emphasis on external equity is most important for:

A) large, global corporations.

B) established firms in highly stable markets.

C) newer, smaller firms in quickly changing markets.

D) privately owned firms in highly competitive industries.

23) Variable compensation systems work best:

A) with smaller, less well-established firms with younger employees.

B) in difficult economies with high rates of inflation.

C) when the job market is flooded with qualified workers.

D) in larger, established companies that need significant productivity improvement.

24) On average, ________ of a U.S. employee's pay is variable.

A) 5%

B) 10%

C) 15%

D) 20%

25) According to your text, as employees' base pay increases, their:

A) variable pay decreases.

B) overall compensation stabilizes.

C) nonmonetary compensation decreases.

D) overall compensation is more subject to risk.

26) Variable compensation takes a variety of forms, including:

A) base salary.

B) hourly wages.

C) profit sharing.

D) disability insurance.

27) A performance-contingent compensation system bases pay upon:

A) employee status.

B) specified hours.

C) required skills.

D) units produced.

28) Rose works for a home interiors company. She hostesses several parties a week and sells various kinds of home decorations. She receives a commission on all that she sells. Rose receives:

A) fixed compensation.

B) membership-contingent compensation.

C) performance-contingent compensation.

D) risk sharing rewards.

29) A membership-contingent compensation system pays employees:

A) for the number of hours during which they perform their assigned jobs.

B) on the basis of the value of the job they perform.

C) on the basis of the skills used to perform their jobs.

D) for how well they do their particular job.

30) Companies using performance-based compensation systems tend to be:

A) publicly-held corporations in competitive markets.

B) smaller, rapidly growing companies that face strong competitive pressures.

C) larger firms with several layers of management that operate in relatively stable markets.

D) large firms that desire to break out of the "pack" and distinguish themselves from competitors.