How can Lisa White encourage her salespeople to promote the more profitable model?
A)Provide higher sales commissions for higher priced items.
B)Put all sales persons on salary.
C)Provide higher sales commissions for items with the greatest contribution margin per constrained resource.
D)Both B and C are correct.

Question

Quizplus · Accepted Answer

Providing higher sales commissions for items with the greatest contribution margin per constrained resource will incentivize the salespeople to promote the more profitable model. This is because they will be able to earn more commission by selling the model that has a higher profit margin. Paying all salespersons on a salary may not incentivize them to push for higher sales since they will be paid the same amount regardless of their sales performance. While providing higher sales commissions for higher-priced items may incentivize them to upsell, it may not necessarily promote the sale of the more profitable model if it is not priced significantly higher than the other models. Therefore, option C is the best choice.

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