Changing from a Straight Salary Plan to a Combination Salary

question 34

Multiple Choice

Changing from a straight salary plan to a combination salary plus commission plan provides a number of benefits. Which of the following is not an advantage of the salary plus commission plan:

• A) They are flexible.
• B) They are simpler and cheaper to administer.
• C) Commissions can be adjusted to reflect the profitability of products.
• D) Commissions provide a fairly immediate reinforcement for the salesperson's efforts.
• E) This type of plan is good for relatively complex products or services.

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Definitions:

Doggerel

Verse or words that are clumsily formed or expressed, often lacking in artistic value.

Paasche Price Index

An economic measure that calculates the change in the cost of purchasing a specific basket of goods and services in a given year compared to a base year, using the current year's prices.

Utility Function

A mathematical representation of a consumer's preference ranking for a set of goods or services, showing the level of satisfaction or utility derived from each combination of goods.

Doggerel

Verse or words that are poorly written or expressed, often characterized by irregularities or crudeness.