Which of the Following Describes the Major Disadvantage Associated with a Combination

question 21

Multiple Choice

Which of the following describes the major disadvantage associated with a combination compensation plan?

• A)its inability to be used as a motivation tool
• B)its complexity
• C)it encourages building long-term relationships with customers
• D)it encourages customer service
• E)the way it gives the company more control over its sales force

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Definitions:

Opportunity Cost

The loss of potential gain from other alternatives when one alternative is chosen over others.

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount they actually do pay.

Price Elasticity

The determination of how price alterations influence the market demand for a commodity.

Marginal Value

The additional satisfaction or utility received by consuming one more unit of a good or service.