1. The most common bases for determining internal structures are:

1. Work content and its value.

2. Seniority and experience.

3. Use value and exchange vlaue.

4. Pay surveys and job evaluation.

2. Mich Inc., a hardware store, has a rating system in place that rates employees on their friendliness, usefulness, and product knowledge. Based on the ratings an employee receives, he or she gets an incentive. The compensation strategy followed by Mich is most closely described as a:

1. Customer-focused strategy.

2. Cost-cutter strategy.

3. Innovator strategy.

4. Differentiation strategy.