Final answer:
A bonus paid based on an employee's performance is called a performance-based bonus. The option that correctly describes this type of bonus is A, Performance-based. Performance-based bonuses serve as extrinsic motivation and are a reward for meeting or surpassing certain performance targets.
Step-by-step explanation:
A bonus paid to an employee based on his or her performance at the end of a period is referred to as a performance-based bonus. This is a type of incentive given to employees for achieving certain performance targets or for their significant contributions to the company's success. The main answer to the student's question would be option A, Performance-based. A discretionary bonus, on the other hand, is given at the discretion of the employer, and not necessarily based on set performance criteria. Formula-based bonuses are calculated using a predetermined formula, typically involving company profits and the individual's performance metrics. Finally, service-based bonuses are given as recognition for an employee's years of service to the company.The businessman in the provided information may hope for such a bonus, as it would be a tangible reward for his hard work. However, if he is too nervous to ask for a raise, he may not directly influence the discretionary decision of his manager. The sentiment that 'hard work is its own reward' reflects an intrinsic motivation, but in business settings, extrinsic rewards such as performance-based bonuses can significantly enhance motivation and job satisfaction.