Data Concerning Wislocki Corporation's Single Product Appear Below

question 393

Essay

Data concerning Wislocki Corporation's single product appear below:
Fixed expenses are $1,033,000 per month. The company is currently selling 9,600 units per month.Required:
The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $13 per unit. In exchange, the sales staff would accept an overall decrease in their salaries of $113,000 per month. The marketing manager predicts that introducing this sales incentive would increase monthly sales by 420 units. What should be the overall effect on the company's monthly net operating income of this change?

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Definitions:

Demand Curve

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Demand

The desire and ability of consumers to purchase goods or services at a given price.

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A popular food item consisting of a cooked patty of ground meat, usually beef, placed inside a sliced bread roll or bun.