Question
Suppose compensation is given by W = 450,000 + 220 + 15S, where W = total compensation of the CEO, = company profits (in millions)
Suppose compensation is given by W = 450,000 + 220 + 15S, where W = total compensation of the CEO, = company profits (in millions) = $300, and S = sales (in millions) = $500. What percentage of the CEO's total earnings is tied to profits of the firm?
Multiple Choice
- 7.9 percent
- 12.6 percent
- 6.0 percent
- 43.4 percent
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Managerial Economics Theory Applications and Cases
Authors: Bruce Allen, Keith Weigelt, Neil A. Doherty, Edwin Mansfield
8th edition
978-0393124491, 393124495, 978-0039391277, 393912779, 978-0393912777
