CCP Market Pricing & Salary Surveys 2

Question 1

Which statistical measure is most commonly used to represent the 'market rate' for a job in salary survey data?

Accepted Answer

Median

Answer

The median is preferred because it is not skewed by extreme high or low values the way the mean can be.

Question 2

When aging survey data to the current date, a company uses a 3% annual salary increase factor. If the survey was conducted 9 months ago, what aging factor should be applied?

Accepted Answer

1.0225

Answer

9 months is 0.75 of a year, so the factor is 1.03^0.75 ≈ 1.0225.

Question 3

A company's pay practice line shows that its actual pay falls below the market pay line. This situation is described as:

Accepted Answer

Lag strategy

Answer

A lag strategy intentionally pays below market, often used to offset superior non-cash benefits.

Question 4

Which survey data element best indicates the spread of actual pay practices among survey participants for a given job?

Accepted Answer

25th and 75th percentile

Answer

The 25th and 75th percentiles show the interquartile range, capturing mid-distribution pay spread while excluding extreme outliers.

Question 5

In a salary survey, 'incumbent data' refers to:

Accepted Answer

Data about current employees holding the benchmarked jobs

Answer

Incumbent data captures the actual pay of employees currently in the surveyed roles at participating organizations.

(CCP) Certified Compensation Professional Practice Test

(CCP) Certified Compensation Professional Practice Test

CCP Market Pricing & Salary Surveys 2