Incentive Plans Quiz

Isla's company wants to align its employees' performance with its business goals. Which incentive program should it consider implementing?

• Fixed hourly wages

• Annual bonuses

• Profit-sharing plan

• Spot bonuses

Ava works in a manufacturing firm where she is paid based on the number of units she produces. Which type of incentive plan is this?

• Standard hour plan

• Differential piece rate

• Straight piecework

• Salary plus commission

A tech company grants stock options to its employees, including Charlotte and Emma, to improve productivity and create a sense of ownership. What type of incentive plan is this?

• Team incentive plan

• Individual incentive plan

• Gainsharing plan

• Enterprise incentive plan

Grace works at a sales company that implements a plan where employees receive a salary plus a bonus if they reach their sales targets. Which incentive plan does this describe?

• Straight salary plan

• Straight commission plan

• Combined salary and commission plan

• Salary plus bonus plan

What is a key characteristic of an effective profit-sharing plan that Jackson and his colleagues at the tech startup are considering?

• Payments are made annually only

• Employees have no influence over the profits

• There is a clear connection between employee performance and company profits

• Payments are based solely on seniority

Abigail works at a retail store that offers a 'spot bonus' to employees who go above and beyond their normal duties. What is a spot bonus?

• A planned bonus given at the end of the year

• An unplanned bonus for exceptional performance

• A bonus based on sales targets

• A bonus for senior employees only

In a classroom setting, which incentive plan might discourage creativity among students like Charlotte and Emma because it focuses solely on output quantity?

• Differential piece rate

• Straight piecework

• Standard hour plan

• Profit-sharing plan

In which scenario is a gainsharing plan most effective for a group of students working on a project together?

• Individual achievements are highly valued

• Team collaboration and cost reduction are prioritized

• Students are rewarded based on seniority

• Bonuses are tied to stock market performance

What is a potential drawback of merit pay programs in a company where Mia and Evelyn work?

• They are based on a fixed percentage of company profits

• They do not become part of the base salary

• They may create feelings of pay inequity among employees

• They are always viewed as fair by all employees

Why might a company use a combined salary and commission plan for its sales force?

• To ensure consistent earnings regardless of sales performance

• To motivate employees like Aiden with a guaranteed income plus the potential for higher earnings

• To avoid paying any performance-based incentives

• To make salary decisions based solely on seniority