What Is the Purpose of a Profit-Sharing Plan

question 32

Multiple Choice

What is the purpose of a profit-sharing plan?

• A) to allow workers to contribute ideas and suggestions
• B) to motivate a total commitment to the organization as a whole
• C) to enable workers to share in labour cost savings
• D) to instill commitment to the employee's immediate work group

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Definitions:

Preferred Mix

The optimal combination of goods and services an economy should produce, taking into account consumer preferences, resource availability, and socio-economic objectives.

Venture Capital

Financing provided by investors to startup companies and small businesses with perceived long-term growth potential.

Retained Earnings

The portion of a company's profits not paid out as dividends, but reinvested in the business.

Total Utility

The complete satisfaction or fulfillment a person derives from consuming a certain quantity of goods or services.