Tray Has a T-Shirt Business That Buys Shirts from a Wholesaler

question 39

Multiple Choice

Tray has a T-shirt business that buys shirts from a wholesaler for four dollars each and sells them to retailers for eight dollars each. He imprints each shirt with a picture of a musical artist that costs him two dollars. He also pays his cousin to do the printing at five dollars an hour. LaShawn prints five shirts per hour. A retailer offers to buy 1000 shirts at seven dollars each. Should Tray agree to the deal?

• A) Yes, Tray will make a profit of one dollar per shirt.
• B) No, Tray will not make a profit at this price.
• C) Yes, Tray will make a marginal profit at this rate.
• D) Yes, even though he may lose money he can make up for it in volume.

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Definitions:

Delayering

The process of reducing the number of levels in an organization's hierarchy, aiming to simplify structures and improve communication and decision-making.

Skill-based Pay Systems

Compensation strategies where employees are paid based on the number, kind, or level of skills they possess, rather than their job title or position.

Job Enrichment

Empowering workers by adding more decision-making authority to jobs.

Piecework Plan

A compensation system where employees are paid a fixed rate for each unit of production or action they complete, encouraging productivity.