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International Remuneration - An Overview of Global Rewards Questions 41–45 (page: 10)

Updated On: 10-Feb-2026

A company uses a "local plus" compensation approach for employees on long-term assignments in high-cost regions.
What is a significant disadvantage of this approach?

  1. Increased administrative burden due to variable benefits
  2. Difficulty in providing a uniform standard of living for all employees
  3. Potential resentment among local employees due to perceived preferential treatment
  4. Complications in calculating host-country taxes

Answer(s): C



Which of the following best describes the "destination services" often provided to expatriates as part of an international assignment package?

  1. Language training and cultural orientation
  2. Housing allowances and travel reimbursements
  3. Tax equalization and financial advisory services
  4. Health insurance and retirement benefits

Answer(s): A



When adopting a "host-country approach" to expatriate compensation, what is one primary drawback of this method?

  1. It is less expensive than the home-country approach
  2. It often fails to account for exchange rate fluctuations
  3. It may result in lower-than-expected income for expatriates from high-income countries
  4. It simplifies payroll processing across international locations

Answer(s): C



A company using a "balance sheet approach" includes a "hardship premium" in the expatriate compensation package. Under what condition is this premium typically granted?

  1. When the assignment involves significant health and safety risks
  2. For any international assignment, regardless of location
  3. Only when the cost of living is substantially lower in the host country
  4. For employees who have been on assignment for over a year

Answer(s): A



In a global pay strategy, a company uses a "market-based approach" to set pay levels.
Which of the following would best describe a challenge of this approach in an international context?

  1. Difficulty in benchmarking pay levels due to varying market conditions
  2. Requirement to use a standardized global pay grade
  3. Reduced flexibility to adapt compensation to individual performance
  4. Decreased alignment with headquarters' pay policies

Answer(s): A



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