Your Boss Thinks You Should Implement a Salary Plus Commission

question 27

Multiple Choice

Your boss thinks you should implement a salary plus commission plan. You have a meeting with her to outline the drawback(s) of this type of plan. Among the drawback(s) you will discuss include:

• A) more complicated to explain to salespeople.
• B) more costly to administer.
• C) sales managers lose control in direct proportion to the amount of commissions paid.
• D) If an incentive ceiling is put in place, it could dampen some salespeople's motivation.
• E) all of the above.

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Definitions:

Intrinsic Rewards

The personal satisfaction and enjoyment derived from completing a task or achieving a goal, independent of external rewards or recognition.

Extrinsic Rewards

Rewards given to employees that are external to the job itself, such as pay, benefits, bonuses, and promotions, aimed at motivating employees' performance.

Internal Promotions

The practice of filling vacancies within an organization by promoting existing employees rather than hiring externally.

Employee Stock Plans

Programs allowing employees to purchase or receive shares in the company they work for, often at advantageous conditions.