1.You were recently hired as the new vice president of sales because something needs to be done to increase sales growthsales have been flat the past two years. You are convinced that the sales force could turn things around for you, if only you could motivate your salespeople. One of your ideas is to change the compensation plan for next year. However, you don't want to "break the bank" in the process. Your marketing manager has developed three different compensation plans for your review. Which of these will be the most expensive? Which will be the least expensive? Which plan would you adopt for your sales staff? Why?

a.Plan A: Give each salesperson a salary of $40,000. Once a salesperson reaches a sales volume of $400,000 during the year, an incentive bonus of 8 percent of all sales made during the year will be awarded. No bonus will be awarded for annual sales volumes of under $400,000.

1.You were recently hired as the new vice president of sales because something needs to be done to increase sales growthsales have been flat the past two years. You are convinced that the sales force could turn things around for you, if only you could motivate your salespeople. One of your ideas is to change the compensation plan for next year. However, you don't want to "break the bank" in the process. Your marketing manager has developed three different compensation plans for your review. Which of these will be the most expensive? Which will be the least expensive? Which plan would you adopt for your sales staff? Why?

a.Plan A: Give each salesperson a salary of $40,000. Once a salesperson reaches a sales volume of $400,000 during the year, an incentive bonus of 8 percent of all sales made during the year will be awarded. No bonus will be awarded for annual sales volumes of under $400,000.