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Which of the tollowing examples explains the equity theory? O A Thomas enjoys so

ID: 388555 • Letter: W

Question

Which of the tollowing examples explains the equity theory? O A Thomas enjoys socializing and joins a ltness club where he can interact with a large number of people that obtaining a high score in the entrance test would secure her an admission in a top business school O C. Sharon feels that OD Michaei aims to complete three progects that will save time and costs for his bank's loan processing operations during the year she should have received a higher pay increase compared to her colleague as she finds that her performance was superior to theirs

Explanation / Answer

Equity theory explains the balancing of what input we give and what we obtain as an output. The inputs are effort, hardwork, loyalty etc., and the outputs are promotion, bonus, praise etc., Among the given examples Sharon thinks her performance was not given proper recognition. She feels that she must receive a higher pay when compared to her colleagues as her performance was superior to them. Hence she wants to balance her hardwork with pay which is an example of equity theory . Hence the answer is C.

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