A Salesperson Who Is Paid Through Bonuses Given When the Boss

question 24

Multiple Choice

A salesperson who is paid through bonuses given when the boss can afford them is being reinforced using a

• A) fixed ratio schedule.
• B) variable ratio schedule.
• C) fixed interval schedule.
• D) variable interval schedule.

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Definitions:

Equivalent Annual Annuity

A financial calculus method for comparing the annualized cash flows of projects with different lifespans.

Initial Outlays

The initial investments or costs incurred when starting a project, business, or investment.

Net Present Value

A financial measure that assesses an investment's profitability by calculating the difference between the present value of cash inflows and the present value of cash outflows throughout a certain timeframe.

Internal Rate of Return

The discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.