Sales Strategy A small business is considering hiring a new sales representative (sales rep) to market its product in a nearby city. Two pay scales are under consideration.
Pay Scale 1 Pay the sales rep a base yearly salary of $10, 000 plus a commission of 8% of total yearly sales.
Pay Scale 2 Pay the sales rep a base yearly salary of $13, 000 plus a commission of 6% of total yearly sales.
a. For each of the pay scales above, use a formula to express the total yearly earnings for the sales rep as a function of total yearly sales. Be sure to identify clearly what the letters that you use mean.
b. What amount of total yearly sales would result in the same total yearly earnings for the sales rep no matter which of the two pay scales is used?
c. On the same screen, plot the graphs of the functions you made in part a. Copy the picture onto the paper you turn in. Be sure to label the horizontal and vertical axes, and be sure your picture includes the number you found in part b.
d. If you were a sales rep negotiating for the new position, under what conditions would you prefer pay scale 1? Under what conditions would you prefer pay scale 2?
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