Some top-performing salespeople earn more than their managers. This compensation is most likely made up of:

Question

BlackTom AI · Accepted Answer

The question asks about the typical components of compensation for top-performing salespeople who may earn more than their managers.
Option 1: 'bonuses only' — This is too narrow. While bonuses can be a part of compensation, relying on bonuses alone ignores the steady base pay and potential commission structure that many sales roles use to reward ongoing performance.
Option 2: 'bonuses and dividends' — Dividends are payments to shareholders and are not a standard part of an individual salesperson's compensation package. This option misapplies a corporate finance concept to a sales compensation context.
Option 3: 'base salary, commissions, bonuses, and incentives' — This combination reflects a common compensation mix in sales: a fixed base salary for stability, commissions tied to sales performance, performance bonuses for achieving targets, and additional incentives (which could include recognition programs, contests, or non-cash rewards) to drive higher performance. It captures both guaranteed and performance-based elements.
Option 4: '100% commissions' — While some roles or startups may offer high variability with only commissions, top performers who earn more than managers typically still rely on a base salary to maintain financial stability and predictable earnings, along with commissions and incentives. A 100% commission structure is uncommon for most mature organizations and would not explain earnings consistently higher than managers across the board.
In summary, the most comprehensive and realistic description among the options is the multi-component package that blends base pay with performance-based components, whereas the other options either overemphasize a single element or mischaracterize standard compensation structures in sales roles.

Some top-performing salespeople earn more than their managers. This compensation is most likely made up of:

View Explanation

Log in for full answers

Similar Questions

The most frequently used type of compensation plan for salespeople is a ________ Blank compensation plan.

Companies are increasingly moving away from high commission compensation plans because such plans often lead to salespeople ________.

According to the textbook, most firms have a reward system for their sales force that

With a ________ Blank , a salesperson's earnings are directly tied to sales or profits generated.

Which of the following is not a method for compensating a salesperson?

Sales reps received compensation basically immediately upon making contact with a prospect.

Avanti sales representatives were offered a base salary IN ADDITION to a commission.

In a consumer society, many adults channel creativity into buying things

More Practical Tools for Students Powered by AI Study Helper

Homework AI Solver

Stylized AI Paper Writer

Plagiarism Checker Assistant

Citation AI Academic Writing Tool

In-Class Translation Assistant

AI Note Generator

AI Quiz Answers

Past Exam Questions from University Test Bank

Smart Practice Assistant

Adaptive Practice

Making Your Study Simpler