Direct, Indirect & Non-Financial Compensation Strategies Video


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question 1 of 3

Alex is paid a salary of $35,000 a year with the potential for further money if he meets certain performance goals. Why is this an example of direct financial compensation?

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1. Beth receives stock options from her employer as part of her overall compensation package. What type of compensation is this?

2. Which of the following is an example of non-financial compensation?

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About This Quiz & Worksheet

With this quiz and worksheet, you can see how much you've learned about the types of compensation strategies businesses use to pay their employees. The quiz includes scenarios in which you'll need to identify which type of compensation strategy is being employed, as well as other multiple-choice questions about compensation types.

Quiz & Worksheet Goals

Use these assessment tools to evaluate your knowledge of:

  • The compensation strategy or package in use in given examples
  • What employers should consider when creating a compensation strategy
  • The meaning of 'internal equity' as it's related to compensation

Skills Practiced

This worksheet and quiz will let you practice the following skills:

  • Reading comprehension - ensure that you draw the most important information from the related lesson on compensation strategies
  • Interpreting information - verify that you can read information regarding the characteristics of different types of compensation strategies and interpret it correctly
  • Knowledge application - use your knowledge to answer questions about which compensation strategy a business is using in a particular scenario

Additional Learning

To learn more about the options available to employers for compensating their employees, review the corresponding lesson on Compensation Strategies. This lesson covers the following objectives:

  • Review how direct compensation works
  • Compare and contrast direct and indirect financial compensation
  • Explore types of noncash benefits
  • Examine the nonfinancial compensation strategy
  • Know what employers need to take into account when developing compensation strategies