UARK MGMT 2103 - Exam 3 Complete Questions And Answers 2026
1. Internal Equity in the same firm
-job structure: primary factor when making internal comparisons
2. External Equity in another firm
-pay level: primary factor when making external comparisons
3. Market Pay Sur- provides information on going rates of pay among competing organizations
veys -3 Issues to Consider:
1. Which employers should be included in the survey?
2. What jobs are included in the survey?
3. If multiple surveys are used, how are all the rates of pay weighted and com-
bined?
4. Benchmarking comparing an organizations practices against those of the competition
5. Key Jobs benchmark jobs, used in pay surveys, that have relatively stable content and are
common to many organizations
6. Non-Key Jobs jobs that are unique to organizations and that cannot be directly valued or
compared through the use of market surveys
7. Job Evaluation a method for matching a salary with a job; administrative procedure used to
measure internal job worth
8. Point System of quantitative job evaluation that determines the relative value of a job by the total
Job Evaluation points assigned to it
-permits jobs to be evaluated on the basis of compensable factors (experience,
education, complexity..) that constitute a job
9. Pay Policy Line equation that describes the relationship between a job's pay and its job evaluation
points
10. Pay Grades jobs of similar worth or content grouped together for pay administration purpos-
es
, UARK MGMT 2103 - Exam 3 Complete Questions And Answers 2026
11. Pay Structure: -More Grades: job ditterences more closely relate to pay ditterences
Pros -Fewer Grades: fewer, broader grades (broadbanding) increases simplicity and
equality
12. Pay Structure: -More Grades: job evaluations are costly, time consuming, and create seemingly
Cons artificial distinctions
-Fewer Grades: decreased opportunity for promotion and weaker budgetary
control
13. Broadbanding as having extremely wide salary bands
it Relates to Com- -encourages the development of broad employee skills because non-managerial
pensation? jobs are appropriately valued and skill development is rewarded
100% ditterence between minimum and maximum salaries
14. Executive Com- -Base Salary:
pensation Pack- -Executive Short-Term iIncentive - annual bonuses based on the pay for-perfor-
ages mance strategy
-Executive Long-Term Incentives: right to buy company stock at discounted price
(executive pay varies with performance of stock market)
-Stock Grants: stock given to employees as compensation/part of compensation
-Executive Benefits: health insurance, life insurance, retirement plans, paid vaca-
tions, payment of mortgage interest
-Executive Perquisites/Perks
15. Equal Pay Act of men and women in the same firm who do "equal work" must be paid equally
1963 -equal in terms of skill, responsibility, and working conditions (requires a job
analysis)
-if these factors ditter, pay can be unequal (ditterences in training, shift, and
seniority)
16. Fair Labor Stan- established minimum wage and overtime pay rate (overtime includes work that
dards Act of 1938 an employee is expected to do)
, UARK MGMT 2103 - Exam 3 Complete Questions And Answers 2026
17. Salary compensation is computed on the basis of weekly, biweekly, or monthly pay
periods
18. Exempt those employees (executive, professional, administrative and outside sales, as
well as certain "computer employees") not covered by the FLSA and not eligible
for overtime pay
19. Non-Exempt employees that are covered under FLSA; includes most hourly jobs
20. Reinforcement theory that states high employee performance followed by a monetary reward will
Theory make future high performance more likely
21. Expectancy Theo- theory that says motivation is a function of valence, instrumentality and expectan-
ry cy
-ettort will result in performance -> expectancy
-performance will result in outcomes -> instrumentality
-Outcomes will be valuable -> valence
22. Agency Theory person (e.g. a manager) who is expected to act on behalf of a principal (e.g. an
owner)
23. Merit Increase a grid that combines an employee's performance rating with employee's position
Grid in a pay range to determine size and frequency of his or her pay increase
24. Merit Bonus merit pay paid in the form of a bonus, instead of a salary increase
-ditters from merit pay raise in that bonus is paid once; raise is a permanent salary
increase
25. Concerns on -accuracy of raise depends on accuracy of performance evaluation method
Merit Pay Plans -can encourage competition when budget or economic constraints exist
-average ditterence in raises between high and average performers is around
$21.15/week
26.
1. Internal Equity in the same firm
-job structure: primary factor when making internal comparisons
2. External Equity in another firm
-pay level: primary factor when making external comparisons
3. Market Pay Sur- provides information on going rates of pay among competing organizations
veys -3 Issues to Consider:
1. Which employers should be included in the survey?
2. What jobs are included in the survey?
3. If multiple surveys are used, how are all the rates of pay weighted and com-
bined?
4. Benchmarking comparing an organizations practices against those of the competition
5. Key Jobs benchmark jobs, used in pay surveys, that have relatively stable content and are
common to many organizations
6. Non-Key Jobs jobs that are unique to organizations and that cannot be directly valued or
compared through the use of market surveys
7. Job Evaluation a method for matching a salary with a job; administrative procedure used to
measure internal job worth
8. Point System of quantitative job evaluation that determines the relative value of a job by the total
Job Evaluation points assigned to it
-permits jobs to be evaluated on the basis of compensable factors (experience,
education, complexity..) that constitute a job
9. Pay Policy Line equation that describes the relationship between a job's pay and its job evaluation
points
10. Pay Grades jobs of similar worth or content grouped together for pay administration purpos-
es
, UARK MGMT 2103 - Exam 3 Complete Questions And Answers 2026
11. Pay Structure: -More Grades: job ditterences more closely relate to pay ditterences
Pros -Fewer Grades: fewer, broader grades (broadbanding) increases simplicity and
equality
12. Pay Structure: -More Grades: job evaluations are costly, time consuming, and create seemingly
Cons artificial distinctions
-Fewer Grades: decreased opportunity for promotion and weaker budgetary
control
13. Broadbanding as having extremely wide salary bands
it Relates to Com- -encourages the development of broad employee skills because non-managerial
pensation? jobs are appropriately valued and skill development is rewarded
100% ditterence between minimum and maximum salaries
14. Executive Com- -Base Salary:
pensation Pack- -Executive Short-Term iIncentive - annual bonuses based on the pay for-perfor-
ages mance strategy
-Executive Long-Term Incentives: right to buy company stock at discounted price
(executive pay varies with performance of stock market)
-Stock Grants: stock given to employees as compensation/part of compensation
-Executive Benefits: health insurance, life insurance, retirement plans, paid vaca-
tions, payment of mortgage interest
-Executive Perquisites/Perks
15. Equal Pay Act of men and women in the same firm who do "equal work" must be paid equally
1963 -equal in terms of skill, responsibility, and working conditions (requires a job
analysis)
-if these factors ditter, pay can be unequal (ditterences in training, shift, and
seniority)
16. Fair Labor Stan- established minimum wage and overtime pay rate (overtime includes work that
dards Act of 1938 an employee is expected to do)
, UARK MGMT 2103 - Exam 3 Complete Questions And Answers 2026
17. Salary compensation is computed on the basis of weekly, biweekly, or monthly pay
periods
18. Exempt those employees (executive, professional, administrative and outside sales, as
well as certain "computer employees") not covered by the FLSA and not eligible
for overtime pay
19. Non-Exempt employees that are covered under FLSA; includes most hourly jobs
20. Reinforcement theory that states high employee performance followed by a monetary reward will
Theory make future high performance more likely
21. Expectancy Theo- theory that says motivation is a function of valence, instrumentality and expectan-
ry cy
-ettort will result in performance -> expectancy
-performance will result in outcomes -> instrumentality
-Outcomes will be valuable -> valence
22. Agency Theory person (e.g. a manager) who is expected to act on behalf of a principal (e.g. an
owner)
23. Merit Increase a grid that combines an employee's performance rating with employee's position
Grid in a pay range to determine size and frequency of his or her pay increase
24. Merit Bonus merit pay paid in the form of a bonus, instead of a salary increase
-ditters from merit pay raise in that bonus is paid once; raise is a permanent salary
increase
25. Concerns on -accuracy of raise depends on accuracy of performance evaluation method
Merit Pay Plans -can encourage competition when budget or economic constraints exist
-average ditterence in raises between high and average performers is around
$21.15/week
26.
