A progressive commission plan will encourage employees to sell more than a regressive plan will.

Question

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In a progressive commission plan, the commission rate increases as the amount of sales increases. This incentivizes employees to sell more, as they will earn a higher commission rate on their increased sales. In contrast, a regressive commission plan reduces the commission rate as the amount of sales increases, which could discourage employees from selling more.

A Progressive Commission Plan Will Encourage Employees to Sell More