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An hourly rate of pay or a monthly salary received regardless of output level is known as what?
AIncentive pay earned by the employee
BProfit sharing paid once a year
CBase pay received by the employee
DA bonus paid for a cost saving
Answer & Solution
Correct answer: C. Base pay received by the employee
1. Base pay is the hourly rate or monthly salary an employee receives whatever the output level turns out to be.
2. Because it does not move with output, it is the stable floor of an employee's earnings.
3. Incentive pay, bonuses, and profit shares all sit on top of base pay and do depend on results.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 8 "Managing Human Resources and Labor Relations", section Types of Compensation or Pay_
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