Question

Blue Chips Ltd. offers to its employees, issue of shares at a price which is less than the market price.

(i) Name and explain the type of incentive offered to the employees.

(ii) Explain one more incentive of the same category.

Answer 1

(i) By offering its employees, the issue of shares at a price less than the market price, Blue Chips Ltd. offered 'co-partnership' which is a financial incentive. The company did so in order to motivate its employees to work with great zeal.

Financial incentives: It refers to those incentives which are measurable and paid in monetary form.

(ii) The bonus is an incentive offered over and above wages/salaries to the employees.