Nolan works for a flashlight manufacturing company. He is paid a fixed amount for every unit he manufactures at the factory. He is paid higher rates for exceeding his set target. The payment system in this scenario is an example of the ________ system.

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The payment system in this scenario is an example of the piece-rate system. According to the classical theory of motivation, money is the sole motivator for workers. Frederick Taylor suggested that managers link workers' pay directly to their output. He developed the piece-rate system, under which employees were paid a certain amount for each unit they produced; those who exceeded their quota were paid a higher rate per unit for all the units they produced.

Nolan Works for a Flashlight Manufacturing Company