Question

Open Ended

Electronic City pays its starting employees $8.50/hour. After 6 months, employees get a choice of how they would like to be paid. They can choose from one of the following plans:

Plan A: Remain at $8.50/hr, working 40 hours a week.

Plan B: $200/wk plus 3% commission on all of the employee's sales, working 40 hours a week.

Plan C: $100/wk plus 5% commission on all of the employee's sales, working 40 hours a week.

Martina has been working for Electronic City for 6 months and is trying to decide what salary plan she should choose. Over the last 2 months her sales have remained steady between $4,500 and $5,500 per 40 hour week.


-Which plan do you think Martina should choose? Explain why. Make sure to provide mathematical resons and/or specific examples to support your conclusion.

-Using the plan you chose, how much would Martina make in a week if she sold $5,100 worth of merchandise?



This is what I got:

Plan A- $8.50*$40.00=$340.00
Plan B- $200+.03*$4,500=$135.00+$200.00=$335.00
Pan C- $100+.05*$4,500=$4,500*.05=$225+$100= $325.00

Note: I don't understand for why in plan c did they multiply $4500*.05 when in planB they added $135.00+$200.00


For the second Question I got:

(I choose Plan B and that's why I started off with plan B.)

Plan B- $200+.03*$5100=$153.00+$200=$353.00

Pan C- $100+.05*$5100=$255.00+$100=$355.00

NOTE:


I don't undrestand how I got any of these answers. Can you help me understand how I got these answers?

Can you help me explain it into words how I got these answers

Answer 1

ok, let's take
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Plan B: $200/wk plus 3% commission on all of the employee's sales, working 40 hours a week.
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She thinks she can count on selling at least $4500 per week, but on a good week, $5500

So she figures she can make her basic $200 per week plus the 3% commission on her $4500 sales.
3% is 3/100 = .03

so take .03 times 4500 = 135 in commissions
135 plus her basic 200 per week =

200 + 135 = $335 per week.

BUT she might sell $5500 per week
in that case she would get

200 + .03 * 5500 =
200+165
= $365
so in a bad week under plan B she would make $335 and in a good week she would make $365.
on the average she might make (335+365)/2 = $350 per week, which is better than plan A which was 340 per week. However on bad weeks she would take home less than the basic plan A pay.