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Question 1

A fine jewelry chain distinguishes itself from the competition by focusing on carefully selected customers and building bonds to meet or exceed their needs and expectations. What strategy is this company using?

Options :

A : Operational excellence

B : Product/service leadership

C : Customer intimacy

D : Brand loyalty

Answer: C

Question 2

Gross margin is which of the following, as percent of revenue?

Options :

A : Revenue minus cost of goods sold

B : Expenses plus taxes and depreciation

C : Gross profit minus expenses

D : Cost of goods sold

Answer: A

Question 3

Why are lump-sum increases generally used?

Options :

A : To control annual fixed costs from base pay adjustments

B : To elevate employees who are below the midpoint in the range

C : To reward employees under short-term incentive plans

D : To make up for benefits not provided by the organization

Answer: A

Question 4

Which of the following is the most accurate statement about the business strategy?

Options :

A : It usually is a secondary consideration in compensation design.

B : It is the company-s plan for competitive positioning of its products or services.

C : It must be written after the company-s operating plans are approved by senior management.

D : It is developed for compensation, benefits and the work-life using the HR strategy as a basis.

Answer: B

Question 5

Regarding fixed and variable costs, what are Finance's primary concerns?

Options :

A : Fixed costs must be kept to a minimum, but variable costs can fluctuate since they tend to correlate with revenue.

B : Variable costs often have a heavier focus than fixed costs, which applies to all areas, including compensation.

C : Fixed costs and variable costs are equally important and both should be kept to a minimum.

D : Fixed costs are not a concern because they cannot be changed, so the focus is primarily on variable costs.

Answer: B