Under a modified wage plan,an employee working an eight-hour day earns $.50 for each finished unit and is guaranteed $20 per hour as a minimum wage.At what level should the daily quota be set?
A)160 units
B)320 units
C)400 units
D)640 units

Question

Quizplus · Accepted Answer

Given the employee is guaranteed $20 per hour for an eight-hour day, this means the minimum they would earn in a day is $20 * 8 = $160. Since they earn $.50 for each finished unit, to make $160 in a day solely from units produced, they would need to produce $160 / $.50 = 320 units. Therefore, the daily quota should be set at 320 units to ensure the minimum wage is met through unit production.

Under a Modified Wage Plan,an Employee Working an Eight-Hour Day