When a Salesperson Is Paid a Commission Based on Some

question 109

Multiple Choice

When a salesperson is paid a commission based on some aggregate of sales, this is evidence of

• A)gain sharing.
• B)an individual performance award.
• C)objective goal setting.
• D)management discretion.
• E)participative decision making.

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Definitions:

Inputs

Inputs are the resources used in the production process to create goods or services, including labor, raw materials, machinery, and capital.

Production

The process of creating goods or services by combining labor, machinery, and materials resources.

Returns to Scale

The rate at which output increases as inputs are increased proportionally.

Long-Run Average Total Cost

The average cost per unit of output when all input factors are variable, and economies of scale are fully exploited.