A Company That Employs a Large Number of Salespeople Is

question 74

Essay

A company that employs a large number of salespeople is interested in learning which of the salespeople sell the most: those strictly on commission, those with a fixed salary, or those with a reduced fixed salary plus a commission. The previous month's records for a sample of salespeople are inspected and the amount of sales (in dollars) is recorded for each, as shown in the table. $$\begin{array}{l}\begin{array} { c c c } \text { Commissioned } & \text { Fixed Salary } & \text { Commission Plus Salary } \\\$ 492 & \$ 450 & \$ 425 \\\$ 507 & \$ 418 & \$ 492 \\\$ 507 & \$ 437 & \$ 470 \\\$ 483 & \$ 432 & \$ 506 \\\$ 466 & \$ 444 & \\\$ 425 & &\end{array}\\\begin{array} { l r r r c } \hline \text { ANALYSIS OF VARIANCE } & \text { DF } & \text { SS } & \text { MS } & \text { F } \\\text { SOURCE } & 2 & 4195 & 2097.7 & 3.17 \\\text { FACTOR } & 12 & 7945 & 662.1 & \\\text { ERROR TOTAL } & 14 & 12140 & & \\\hline\end{array}\end{array}$$ Test to determine if a difference exists in the mean sale amounts among the three compensation systems. Test using α = .025. 10.3 Multiple Comparisons of Means

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Definitions:

CPI Rate

The Consumer Price Index (CPI) rate measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Pay as an Investment

The perspective of compensating employees as a strategic investment towards achieving the organization's goals, where better pay leads to better performance and outcomes.

High-Quality Workforce

A group of employees known for their exceptional skills, high productivity, and capability to drive organizational success.

Labor Costs

The total sum of all wages paid to employees, as well as the costs of employee benefits and payroll taxes incurred by an employer.