A payment plan that induces better worker effort by linking compensation to revenues of the firm is known as:

Question

Quizplus · Accepted Answer

Revenue sharing is a payment plan that ties worker compensation to the revenue of the firm. By linking compensation to revenues, workers are motivated to work hard and contribute to the success of the company. This incentivizes employees to increase productivity and efficiency, which can ultimately lead to higher profits. Moreover, it aligns the incentives of workers with those of the company, promoting a sense of teamwork towards achieving a common goal. Hence, revenue sharing is an effective way to induce better worker effort.

A Payment Plan That Induces Better Worker Effort by Linking