Business Strategy And Market Pricing Quiz
- 1.
What are the objectives of Market Pricing and Business Strategy?
- A.
External competitiveness and pay competitiveness
- B.
Internal competitiveness and pay competitiveness
- C.
Internal equity and pay competitiveness
- D.
External equity and pay competitiveness
- E.
None of these answers
- F.
There are so many options... If it was food I would almost feel full.
Correct Answer
A. External competitiveness and pay competitivenessExplanation
The objectives of Market Pricing and Business Strategy are to ensure external competitiveness, which means aligning the organization's pay practices with the external market rates to attract and retain talented employees. Additionally, it aims to achieve pay competitiveness, which involves ensuring that the organization's pay structure is fair and competitive compared to other companies in the same industry. This helps in motivating and retaining employees while also managing costs effectively.Rate this question:
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- 2.
External competitiveness is:
- A.
A primary objective for most organizations
- B.
Helps organizations remain competitive by helping companies know what the going rates for jobs are in the current market
- C.
Variable over time.
- D.
All of these answers. I think your dawg wants pets.
Correct Answer
D. All of these answers. I think your dawg wants pets.Explanation
External competitiveness is a primary objective for most organizations as it helps them remain competitive by understanding the current market rates for jobs. It is also variable over time, as market conditions and job demands change. Therefore, the correct answer is "All of these answers." The statement about the "dawg" wanting pets is unrelated and does not provide any explanation for the correct answer.Rate this question:
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- 3.
Pay competitiveness is:
- A.
Helps organizations with analyzing pay competitiveness
- B.
Used in obtaining going rates for benchmark jobs against their competitors.
- C.
Analyzing pay trends by identifying year to year movement of salaries and cash compensation
- D.
Identifying pay practices regarding competitive compensation practices, programs, policies, and procedures.
- E.
All of these answers
Correct Answer
E. All of these answersExplanation
Pay competitiveness encompasses all of the mentioned aspects. It helps organizations analyze pay competitiveness by obtaining going rates for benchmark jobs against competitors, analyzing pay trends by identifying salary and cash compensation movement year to year, and identifying pay practices regarding competitive compensation practices, programs, policies, and procedures. Therefore, the correct answer is "All of these answers."Rate this question:
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- 4.
Which of the following is NOT an element of Market Pricing and Business Strategy?
- A.
Internal pay equity
- B.
External Competitiveness
- C.
Fluctuating pay rates
- D.
Organizations must be willing and able to pay
- E.
All of these answers apply.
Correct Answer
A. Internal pay equityExplanation
Internal pay equity is not an element of Market Pricing and Business Strategy. Market pricing and business strategy focuses on external competitiveness, fluctuating pay rates, and the organization's willingness and ability to pay. Internal pay equity, on the other hand, refers to the fairness and consistency of pay within an organization and is not directly related to market pricing or business strategy.Rate this question:
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- 5.
Which of the following is NOT an element of Market Pricing and Business Strategy?
- A.
Regulatory and legal issues.
- B.
In demand workers
- C.
Aligning compensation and philosophy
- D.
Written compensation philosophy
- E.
All of these answers apply.
Correct Answer
A. Regulatory and legal issues.Explanation
The question asks for an element that is NOT part of Market Pricing and Business Strategy. The options include regulatory and legal issues, in demand workers, aligning compensation and philosophy, and a written compensation philosophy. The correct answer is regulatory and legal issues because while it is an important consideration in business strategy, it is not specifically related to market pricing and compensation.Rate this question:
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- 6.
Fluctuating pay rates ensure:
- A.
Being aware of prevailing wage rates in the external marketplace.
- B.
The organization's philosopy, culture, values, competitive positioning strategy, internal and external influences, including its relevant labor pools, and it's financial resources.
- C.
None of these answers
- D.
All of these answers.
Correct Answer
A. Being aware of prevailing wage rates in the external marketplace.Explanation
Fluctuating pay rates ensure being aware of prevailing wage rates in the external marketplace. This means that by having fluctuating pay rates, the organization can stay updated on the current wage rates in the external job market. This is important because it allows the organization to remain competitive and attract and retain talented employees by offering salaries that are in line with the market rates. By being aware of prevailing wage rates, the organization can make informed decisions regarding compensation and ensure that their pay rates are competitive and fair.Rate this question:
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- 7.
Fluctuating pay rates pertains to:
- A.
Helps organizations align their overall pay philosophy while carefully balancing market supply and demand.
- B.
The organization's philosopy, culture, values, competitive positioning strategy, internal and external influences, including its relevant labor pools, and it's financial resources.
- C.
Helps organizations keep a close watch on how competitors are paying their employees, and in particular, hot skills, and identified critical key talent.
- D.
None of these answers.
Correct Answer
D. None of these answers. -
- 8.
Organizations must be willing / able to pay:
- A.
Is impacted by the organization's philosopy, culture, values, competitive positioning strategy, internal and external influences, including its relevant labor pools, and it's financial resources.
- B.
Helps organizations align their overall pay philosophy while carefully balancing market supply and demand.
- C.
Helps organizations keep a close watch on how competitors are paying their employees, and in particular, hot skills, and identified critical key talent.
- D.
None of these answers.
Correct Answer
A. Is impacted by the organization's philosopy, culture, values, competitive positioning strategy, internal and external influences, including its relevant labor pools, and it's financial resources.Explanation
The correct answer is that the ability and willingness of organizations to pay is impacted by various factors such as their philosophy, culture, values, competitive positioning strategy, internal and external influences, including their relevant labor pools, and their financial resources. These factors shape the organization's overall pay philosophy and help them balance market supply and demand. Additionally, it allows organizations to monitor how their competitors are compensating their employees and identify critical key talent.Rate this question:
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- 9.
Organizations must be willing / able to pay can be described as pertaining to the fact that it:
- A.
The organization's philosopy, culture, values, competitive positioning strategy, internal and external influences, including its relevant labor pools, and it's financial resources.
- B.
Helps organizations align their overall pay philosophy while carefully balancing market supply and demand.
- C.
Helps organizations keep a close watch on how competitors are paying their employees, and in particular, hot skills, and identified critical key talent.
- D.
None of these answers.
Correct Answer
A. The organization's philosopy, culture, values, competitive positioning strategy, internal and external influences, including its relevant labor pools, and it's financial resources.Explanation
This answer is correct because it explains that organizations must consider various factors such as their philosophy, culture, values, competitive positioning strategy, internal and external influences, relevant labor pools, and financial resources when determining their willingness and ability to pay. These factors help organizations align their pay philosophy, balance market supply and demand, and keep track of how competitors are compensating their employees, especially for hot skills and critical talent.Rate this question:
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- 10.
In-demand workers:
- A.
Help organizations keep a close watch on how competitors are paying their employees, and in particular, hot skills, and identified critical key talent.
- B.
Highlights certain skill sets that might be in short supply and escalate market pay.
- C.
Identifies hot skills sets that are critical to organizations and, as they are in short supply, they will continue to drive up pay for in-demand workers.
- D.
All of these answers
Correct Answer
D. All of these answersExplanation
The correct answer is "All of these answers" because all the statements mentioned in the question explain the role of in-demand workers. They help organizations monitor competitor pay, identify hot skills in short supply, and drive up pay for in-demand workers. Thus, all the given statements are valid explanations for the role of in-demand workers.Rate this question:
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- 11.
Which of the following describes organizations who attempt to keep a compensation system aligned with an overall pay philosphy that may require, at certain volitile times, a difficult balancing act to ensure that a company has the appropriate workforce to meet its business objectives?
- A.
Aligning compensation system and philosophy
- B.
In-demand workers
- C.
Fluctuating pay rates
- D.
Organizations must be willing / able to pay
Correct Answer
A. Aligning compensation system and philosophyExplanation
Organizations that attempt to keep a compensation system aligned with an overall pay philosophy understand the importance of ensuring that their compensation practices are in line with their organizational values and goals. This requires them to carefully balance the need to attract and retain talented employees with the need to manage costs and meet business objectives. During volatile times, such as economic downturns or industry changes, this balancing act becomes even more challenging as organizations must make difficult decisions to ensure they have the right workforce in place while still adhering to their compensation philosophy.Rate this question:
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- 12.
Which of the following is NOT an element of a Written Compensation Philosopy?
- A.
Helps organizations keep a close watch on how competitors are paying their employees, and in particular, hot skills, and identified critical key talent.
- B.
Ensures that the program supports the organization's mission, goals, and business objectives.
- C.
Used to attract, motivate, and retain employees to attain an origanization's objectives.
- D.
Guides the design, implementation, and administration of the organization's compensation program.
- E.
All of these answers apply.
Correct Answer
A. Helps organizations keep a close watch on how competitors are paying their employees, and in particular, hot skills, and identified critical key talent.Explanation
A written compensation philosophy is a document that outlines an organization's approach and principles regarding employee compensation. It typically includes elements such as ensuring that the program aligns with the organization's mission and goals, using compensation to attract and retain employees, and guiding the design and administration of the compensation program. However, keeping a close watch on how competitors are paying their employees and identifying critical key talent is not typically considered an element of a written compensation philosophy.Rate this question:
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- 13.
Job worth hierarchy is defined as:
- A.
The perceived internal value of jobs in relationship to each other within an organization that forms the basis for grouping similar jobs together.
- B.
Refers to the measure of an organization's pay levels compared to its competitors for people.
- C.
A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization.
- D.
A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.
- E.
The market competitive salary for a job that represents the average prevailing wage for that job in a particular data set.
- F.
None of these answers.
Correct Answer
A. The perceived internal value of jobs in relationship to each other within an organization that forms the basis for grouping similar jobs together.Explanation
The correct answer is the perceived internal value of jobs in relationship to each other within an organization that forms the basis for grouping similar jobs together. This explanation accurately describes the concept of job worth hierarchy, which involves determining the relative value of different jobs within an organization. This perceived value helps in grouping similar jobs together and establishing fair wage rates based on the job's relative value to the organization.Rate this question:
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- 14.
Market rate is defined as:
- A.
The market competitive salary for a job that represents the average prevailing wage.
- B.
Refers to the measure of an organization's pay levels compared to its competitors for people.
- C.
A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization.
- D.
A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.
- E.
The perceived internal value of jobs in relationship to each other within an organization that forms the basis for grouping similar jobs together.
- F.
None of these answers.
Correct Answer
A. The market competitive salary for a job that represents the average prevailing wage.Explanation
Market rate is the correct answer because it refers to the average prevailing wage for a job in the market. It represents the competitive salary that organizations offer to attract and retain employees. By setting their wages at market rate, employers ensure that their pay levels are in line with what other organizations are paying for similar positions. This helps maintain fairness and competitiveness in the labor market.Rate this question:
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- 15.
Market rate can be defined as:
- A.
The perceived internal value of jobs in relationship to each other within an organization that forms the basis for grouping similar jobs together.
- B.
Refers to the measure of an organization's pay levels compared to its competitors for people.
- C.
A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization.
- D.
A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.
- E.
None of these answers.
Correct Answer
E. None of these answers.Explanation
None of the given options accurately define market rate. Market rate refers to the prevailing pay levels in the external job market for specific positions or job roles. It is the rate at which organizations pay their employees in order to attract and retain talent in the competitive job market. The given options either define internal job valuation or job evaluation methods, which are not synonymous with market rate.Rate this question:
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- 16.
Which of the following does NOT describe a Job content evaluation method?
- A.
Implies that the employer pays wages that correspond to prevailing external market rates, as determined by market pricing.
- B.
Based on job content as the primary factor
- C.
Maps your job with the market description
- D.
Market pay levels are a secondary influence on the job worth hierarchy
- E.
Differs from market pricing approaches
- F.
A formal process of building a job worth hierarchy
- G.
All of these answers apply.
Correct Answer
A. Implies that the employer pays wages that correspond to prevailing external market rates, as determined by market pricing.Explanation
The correct answer does not describe a Job content evaluation method because it focuses on the employer paying wages based on external market rates, rather than evaluating the job content as the primary factor. Job content evaluation methods typically involve mapping job descriptions to the market, considering market pay levels as a secondary influence, and building a job worth hierarchy through a formal process.Rate this question:
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- 17.
Which of the following does NOT accurately describes the term External equity?
- A.
Implies that the employer pays wages that correspond to prevailing external market rates.
- B.
A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization.
- C.
The measure of an organization's pay levels compared t thse of its competitors.
- D.
All of these answers apply.
Correct Answer
B. A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization.Explanation
External equity refers to the practice of an employer paying wages that align with the prevailing market rates. It is not a fairness criterion that directs an employer to establish wage rates based on each job's relative value to the organization. Instead, this concept is known as internal equity. The measure of an organization's pay levels compared to its competitors is also a correct description of external equity. Therefore, the correct answer is the option that does not accurately describe external equity, which is "A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization."Rate this question:
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- 18.
Which of the following does NOT accurately describes the term Internal equity?
- A.
A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.
- B.
A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization.
- C.
Is a secondary concern when using a job market approach to making a final determination of wage rates.
- D.
All of these answers apply.
Correct Answer
A. A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.Explanation
Internal equity refers to the fairness and consistency of pay within an organization. It involves comparing jobs within the organization to ensure that similar jobs are compensated equally. The correct answer states that internal equity is not accurately described as a job evaluation method in which jobs are compared in their entirety against one another. However, internal equity is actually achieved by breaking jobs down into their respective components and evaluating each component for factors such as skill, responsibility, and experience. This allows for a more accurate and fair assessment of job value within the organization.Rate this question:
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- 19.
Slotting is defined as:
- A.
The act of placing a job into a job worth hierarchy
- B.
Results from combining market rates for the same job from multiple survey sources.
- C.
A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization.
- D.
A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.
- E.
None of these answers.
Correct Answer
A. The act of placing a job into a job worth hierarchyExplanation
Slotting refers to the act of placing a job into a job worth hierarchy. This means that jobs are categorized and ranked based on their relative value or worth to the organization. It helps establish a clear structure and hierarchy within the organization's job positions, allowing for fair and consistent compensation decisions. This process involves comparing and evaluating jobs as a whole, rather than breaking them down into individual components.Rate this question:
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- 20.
Whole Job Comparison is defined as:
- A.
A fairness criterion that directs an employer to establish wage rates that correspond to each job's relative value to the organization.
- B.
Results from combining market rates for the same job from multiple survey sources.
- C.
The act of placing a job into a job worth hierarchy
- D.
A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.
- E.
None of these answers.
Correct Answer
D. A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.Explanation
Whole Job Comparison is a job evaluation method that involves comparing jobs in their entirety against each other, rather than breaking them down into their individual components. This method allows employers to establish wage rates based on each job's relative value to the organization. It is a fair criterion that ensures that wage rates correspond to the overall importance and contribution of each job within the organization. This method combines market rates from multiple survey sources to determine the appropriate wage rates for each job.Rate this question:
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- 21.
Market rate composite is defined as:
- A.
Results from combining market rates for the same job from multiple survey sources.
- B.
The act of placing a job into a job worth hierarchy
- C.
The middle value identified in a pay range
- D.
A job evaluation method in which jobs are compared in their entirety against one another, as opposed to breaking jobs down into teir respective components and evaluationg each component for factor.
- E.
None of these answers.
Correct Answer
A. Results from combining market rates for the same job from multiple survey sources.Explanation
The correct answer is "Results from combining market rates for the same job from multiple survey sources." This means that the market rate composite is obtained by gathering data on the market rates for a specific job from various survey sources and then combining them to get an average or composite rate. This helps in determining the competitive pay rate for that job in the market.Rate this question:
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- 22.
Midpoint is defined as:
- A.
The middle value identified in a pay range.
- B.
Results from combining market rates for the same job from multiple survey sources.
- C.
A secondary concern when using a job market approach to making a final determination of wage rates.
- D.
The tumalogical region of a big brown dawg.
- E.
None of these answers.
Correct Answer
A. The middle value identified in a pay range.Explanation
The correct answer is "The middle value identified in a pay range." This is because a midpoint is the point that divides a pay range into two equal parts. It represents the middle value or the average of the minimum and maximum values in the range. It is commonly used in compensation and salary structures to determine the appropriate wage for a particular job position.Rate this question:
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- 23.
What are the differnt types of Pay Range?
- A.
Maximum, minimum, midpoint
- B.
Maximum, minimum
- C.
Maximum, mimimum, equitable
- D.
Big brown hungry dawgs will work for the minimum pay range if you feed them.
Correct Answer
A. Maximum, minimum, midpointExplanation
The correct answer is maximum, minimum, midpoint. In a pay range, the maximum represents the highest salary that an employee can earn, while the minimum represents the lowest salary. The midpoint is the salary that falls in the middle of the range. These three types help establish a clear salary structure within an organization and provide a framework for determining fair and equitable compensation for employees based on their skills, experience, and job responsibilities.Rate this question:
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- 24.
Which of the following is NOT an element of a Maximum pay range?
- A.
Is set by internal equity valuations only.
- B.
Critical to observe market fluctuations and market pricing for this group.
- C.
Is a secondary concern when using a job market approach to making a final determination of wage rates.
- D.
All of these answers apply.
Correct Answer
A. Is set by internal equity valuations only.Explanation
The correct answer is "Is set by internal equity valuations only." This answer suggests that a maximum pay range is not solely determined by internal equity valuations. Other factors, such as market fluctuations and market pricing for the group, as well as using a job market approach to determine wage rates, are also important considerations. Therefore, this answer is not an element of a maximum pay range.Rate this question:
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- 25.
Minumum pay range:
- A.
The lowest wage the market (internal structure) will bear.
- B.
Sometimes referred to as the "control point"
- C.
Is someone who is fully competent to perform all tasks required for that job.
- D.
All of these answers apply. your dawg looks hungy.
Correct Answer
A. The lowest wage the market (internal structure) will bear.Explanation
The correct answer is "The lowest wage the market (internal structure) will bear." This means that the minimum pay range is the lowest salary that the market or internal structure of the organization is willing to accept. It is often referred to as the "control point" and is applicable to someone who is fully competent to perform all tasks required for that job.Rate this question:
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- 26.
Which of the following is NOT an element of a Maximum pay range?
- A.
Is set by internal equity valuations only.
- B.
Critical to observe market fluctuations and market pricing for this group.
- C.
Is a secondary concern when using a job market approach to making a final determination of wage rates.
- D.
All of these answers apply.
Correct Answer
A. Is set by internal equity valuations only.Explanation
The correct answer is "Is set by internal equity valuations only." This answer is not an element of a Maximum pay range because a maximum pay range takes into account both internal equity valuations and external market factors. It is important to observe market fluctuations and pricing when determining wage rates, and using a job market approach is crucial in making a final determination. Therefore, the statement that the maximum pay range is set by internal equity valuations only is incorrect.Rate this question:
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- 27.
Determining the Number of pay grades includes:
- A.
Skill or responsibility distinctions
- B.
Supervisor / subordinate relationships
- C.
Career progression
- D.
Administrative considerations
- E.
All of the these are correct.
Correct Answer
E. All of the these are correct.Explanation
The correct answer is that all of the mentioned factors are correct when determining the number of pay grades. Skill or responsibility distinctions, supervisor/subordinate relationships, career progression, and administrative considerations are all important factors to consider when determining the number of pay grades within an organization. These factors help to ensure that employees are appropriately compensated based on their roles and responsibilities, and that there is a clear structure for career advancement and progression. Additionally, administrative considerations such as budget constraints and organizational structure may also influence the number of pay grades that are established.Rate this question:
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- 28.
What is the midpoint differential for this example: Job1 - $27,500 (midpoint) Job2 - $28,900 (midpoint)
- A.
5%
- B.
10%
- C.
33%
- D.
50%
Correct Answer
A. 5%Explanation
The midpoint differential is the percentage difference between the two midpoints. In this example, the midpoint differential is 5% because the difference between Job2's midpoint ($28,900) and Job1's midpoint ($27,500) is $1,400, which is 5% of Job1's midpoint.Rate this question:
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- 29.
External equity refers to the measure of an organization's pay levels compared to its competitors for people.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
External equity refers to the measure of an organization's pay levels compared to its competitors for people. This means that external equity is concerned with ensuring that an organization's pay is competitive and aligned with what other organizations in the same industry are offering. By maintaining external equity, organizations can attract and retain talented individuals who may be tempted to seek higher-paying opportunities elsewhere. Therefore, the statement "External equity refers to the measure of an organization's pay levels compared to its competitors for people" is true.Rate this question:
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- 30.
Benchmark jobs share these general characteristics
- A.
Commonly found and defined
- B.
Data available in surveys
- C.
Used to develop a job worth hierarchy
- D.
Sometimes referred to as "control points".
- E.
Serve as anchor points - used as anchor points because they appear in various organizations and industries.
Correct Answer(s)
A. Commonly found and defined
B. Data available in surveys
C. Used to develop a job worth hierarchy
E. Serve as anchor points - used as anchor points because they appear in various organizations and industries.Explanation
Benchmark jobs are commonly found and defined, meaning that they are positions that are widely recognized and have clear job descriptions. Data on these jobs is available in surveys, which allows organizations to gather information on the compensation and requirements of these positions. Benchmark jobs are used to develop a job worth hierarchy, which helps organizations establish the relative value of different positions within the company. These jobs also serve as anchor points because they are commonly found in various organizations and industries, providing a reference point for comparing and evaluating other positions.Rate this question:
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- 31.
When selecting benchmark jobs choose jobs that share these characteristics
- A.
Are easily defined and fount in other organizations important to you.
- B.
Are representative throughout all levels of the organization; spread from top to bottom and across all functions.
- C.
Are important to the organization's internal hierarchy; ensure that core business employees are fairly represented
- D.
Represents at least 50% of the jobs in the organization
- E.
Reflects the diversity of jobs in your organization.
Correct Answer(s)
A. Are easily defined and fount in other organizations important to you.
B. Are representative throughout all levels of the organization; spread from top to bottom and across all functions.
C. Are important to the organization's internal hierarchy; ensure that core business employees are fairly represented
D. Represents at least 50% of the jobs in the organizationExplanation
The benchmark jobs should have the following characteristics: they should be easily defined and found in other organizations, they should be representative throughout all levels of the organization, spread from top to bottom and across all functions, they should be important to the organization's internal hierarchy to ensure fair representation of core business employees, they should represent at least 50% of the jobs in the organization, and they should reflect the diversity of jobs in the organization.Rate this question:
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- 32.
When determining your relevant labor market be certain to note:
- A.
Markets from which your organization draws or loses employees.
- B.
That it refers to your competition for labor - i.e. where did you hire your employees from and where did they go when the left.
- C.
Are important to the organization's internal hierarchy; ensure that core business employees are fairly represented
Correct Answer(s)
A. Markets from which your organization draws or loses employees.
B. That it refers to your competition for labor - i.e. where did you hire your employees from and where did they go when the left.Explanation
The correct answer emphasizes the importance of identifying the markets from which an organization attracts and loses employees. This information helps in understanding the competition for labor and where the organization sources its workforce. Additionally, tracking where employees go after leaving provides insights into the organization's reputation and attractiveness as an employer. Considering these factors is crucial for the organization's internal hierarchy and ensuring fair representation of core business employees.Rate this question:
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- 33.
A relevant labor market is defined by:
- A.
Organizational size (e.g. revenue, number of employees)
- B.
Geographic location
- C.
Industry
- D.
Ability / willingness to pay
Correct Answer(s)
A. Organizational size (e.g. revenue, number of employees)
B. Geographic location
C. IndustryExplanation
A relevant labor market is determined by factors such as the size of the organization (measured by revenue and number of employees), the geographic location, and the industry in which the organization operates. These factors are important in identifying the pool of potential employees and determining the competitive landscape for attracting and retaining talent. The size of the organization reflects its capacity to hire and pay employees, while the geographic location and industry help define the specific labor market dynamics and supply of skilled workers in that area.Rate this question:
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- 34.
A relevant labor markets can differ by job groups. Please explain:
- A.
Scope-sensitive jobs (e.g. sales and management) - national data broken out by organizational size
- B.
Clerical jobs - local data, all sizes of organization
- C.
Industry - each industry can vary in the amount of compensation it is willing to award to certain jobs.
Correct Answer(s)
A. Scope-sensitive jobs (e.g. sales and management) - national data broken out by organizational size
B. Clerical jobs - local data, all sizes of organizationExplanation
The answer explains that for scope-sensitive jobs like sales and management, national data broken out by organizational size is relevant. This means that when analyzing compensation for these types of jobs, it is important to consider national data and also break it down based on the size of the organization. On the other hand, for clerical jobs, local data is more relevant as it provides a more accurate representation of compensation for these roles across all sizes of organizations. The explanation also mentions that compensation can vary by industry, indicating that different industries may be willing to award different amounts of compensation for certain jobs.Rate this question:
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- 35.
What are some key considerations when slotting:
- A.
Define job - define the criteria for comparing jobs (typically skill, effort, responsibilities, and working conditions.
- B.
Consider value - look at other jobs in the job family, ensure appropriate distance between jobs of the same job family (e.g. 7-10% for non-exempt jobs, 12 to 15% for exempt jobs
- C.
Supervisor / subordinate jobs - Ensure sufficient distance between supervisor and subordinate jobs (usually 15-20%).
- D.
How many people in your organization hold this position.
Correct Answer(s)
A. Define job - define the criteria for comparing jobs (typically skill, effort, responsibilities, and working conditions.
B. Consider value - look at other jobs in the job family, ensure appropriate distance between jobs of the same job family (e.g. 7-10% for non-exempt jobs, 12 to 15% for exempt jobs
C. Supervisor / subordinate jobs - Ensure sufficient distance between supervisor and subordinate jobs (usually 15-20%).Explanation
The key considerations when slotting include defining the criteria for comparing jobs based on skills, effort, responsibilities, and working conditions. Additionally, it is important to consider the value of other jobs in the same job family and ensure an appropriate distance between jobs, such as 7-10% for non-exempt jobs and 12-15% for exempt jobs. Furthermore, there should be a sufficient distance between supervisor and subordinate jobs, typically around 15-20%. The number of people holding the position in the organization is also a factor to consider.Rate this question:
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- 36.
Market pricing is the technique of creating a job worth hierarchy based on market competitive salary for benchmark jobs.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Market pricing is a technique used to establish a hierarchy of job worth based on market competitive salaries for benchmark jobs. This means that organizations determine the value of a job by comparing it to similar positions in the market and setting a salary that is competitive and aligns with market rates. By using market pricing, companies can ensure that their compensation packages are fair and competitive, helping them attract and retain top talent. Therefore, the given statement is true.Rate this question:
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- 37.
A Job worth hierarchy based on market using Market pricing is the technique of creating a job worth hierarchy based on market competitive salary for benchmark jobs.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Market pricing is a technique used to determine the value of jobs in relation to the market. It involves comparing the salaries of benchmark jobs with similar jobs in the market to establish a job worth hierarchy. By using market competitive salaries as a basis, organizations can ensure that their compensation structure is aligned with the external market and attract and retain talented employees. Therefore, the statement that creating a job worth hierarchy based on market competitive salary for benchmark jobs is true.Rate this question:
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- 38.
The three methods of calculating market pricing are:
- A.
Job worth hierarchy based on market
- B.
Rates set on best estimate - job rates are set based on the company's best estimate of the typical wages in the external marketplace for that job.
- C.
External data analyzed to establish worth - External salary data is analyzed to establish the worth of benchmark jobs, as represented by the data, based on the "scope" (company size, industry, geography, etc.)
- D.
Job worth hierarchy based on internal equity
Correct Answer(s)
A. Job worth hierarchy based on market
B. Rates set on best estimate - job rates are set based on the company's best estimate of the typical wages in the external marketplace for that job.
C. External data analyzed to establish worth - External salary data is analyzed to establish the worth of benchmark jobs, as represented by the data, based on the "scope" (company size, industry, geography, etc.)Explanation
The correct answer is a combination of the three methods of calculating market pricing. The first method is job worth hierarchy based on market, which means determining the worth of a job based on its value in the external marketplace. The second method is setting job rates based on the company's best estimate of typical wages in the external marketplace for that job. The third method involves analyzing external salary data to establish the worth of benchmark jobs, taking into account factors such as company size, industry, and geography. By using all three methods, a company can ensure that its job rates are competitive and aligned with market trends.Rate this question:
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- 39.
When using the Rates set on best estimate method for calculating market pricing you should know that:
- A.
Job descriptions are used to match the appropriate jobs
- B.
Market data is analyzed and benchmark jobs are arranged into a job worth hierarchy
- C.
All other jobs are slotted into the hierarchy based on whole job comparison (relative job worth)
- D.
This technique is more time consuming than the "Job worth hierarchy based on market" method.
Correct Answer(s)
A. Job descriptions are used to match the appropriate jobs
B. Market data is analyzed and benchmark jobs are arranged into a job worth hierarchy
C. All other jobs are slotted into the hierarchy based on whole job comparison (relative job worth) -
- 40.
Market pricing data is becoming the more prevelant in more parts of the world.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
The statement suggests that market pricing data is increasingly becoming prevalent in various parts of the world. This implies that more regions are adopting the use of market pricing data, indicating a growing trend towards its usage globally.Rate this question:
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- 41.
Pure market pricing is becoming the more prevelant in more parts of the world.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The statement suggests that pure market pricing is becoming more prevalent in more parts of the world. However, the correct answer is False, indicating that this statement is not true. The explanation for this answer could be that while market pricing may be prevalent in certain parts of the world, it is not necessarily becoming more prevalent globally. Other factors such as government regulations, subsidies, and social policies can also influence pricing mechanisms in different regions.Rate this question:
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- 42.
Market pricing alternative applications include the following
- A.
Market-priced salary structure - Involves pricing benchmark jobs withing the organization, then fitting those jobs into a grade structure at the midpoint closest to the market rate. This is known as "best fit".
- B.
Pure market pricing - Benchmark jobs are priced but not placed into a pay structure
- C.
Total fit - whole job comparison (relative job worth) is used to determin the pay grade structures.
Correct Answer(s)
A. Market-priced salary structure - Involves pricing benchmark jobs withing the organization, then fitting those jobs into a grade structure at the midpoint closest to the market rate. This is known as "best fit".
B. Pure market pricing - Benchmark jobs are priced but not placed into a pay structureExplanation
The correct answer is explaining two different market pricing alternatives: Market-priced salary structure and Pure market pricing. The explanation states that the Market-priced salary structure involves pricing benchmark jobs within the organization and fitting them into a grade structure at the midpoint closest to the market rate, which is known as "best fit." On the other hand, Pure market pricing refers to pricing benchmark jobs without placing them into a pay structure.Rate this question:
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