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WorldatWork Regulatory Environments for Compensation Programs Sample Questions:

1. Which of the following best describes present value?

A) The difference between the desired value in the future and the current value as a percentage of the desired value
B) The current value of holdings and how much it will grow over time at a given rate of return
C) The desired value in the future and what needs to be invested today to realize that amount
D) The current value of holdings

2. 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) Stock/share options
D) Restricted stock/shares

3. Which of the following is the best example of a variable cost?

A) Shipping
B) Audit fees
C) Rent
D) Maintenance

4. How does the Fair Labor Standards Act require employers to pay their nonexempt employees?

A) Double time for work on Saturday
B) Time and a half for all hours worked over 40 in the workweek
C) Double time for time worked on Sunday
D) Time and a half for all hours worked over 8 in the workday

5. 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?

A) Additional quantitative analysis to determine whether pay rates are truly competitive or existing data are unreliable
B) No additional data analysis is needed. Delta should increase pay rates based on the existing data to decrease turnover.
C) Qualitative data collection to talk to key stakeholders and employees and determine whether the exit interviews accurately reflect their concerns
D) Qualitative data collection in the form of an employee survey with questions about employee satisfaction with pay levels

Solutions: