A company would like to evaluate two incentive schemes that take effect once the worker exceeds standard
Question:
A company would like to evaluate two incentive schemes that take effect once the worker exceeds standard performance. In the first case the benefits are split 30% to the worker and 70% to the company up to 120% performance. If the worker exceeds 120% performance, all of the earnings go to the worker. In the second case, all earnings beyond standard performance are split 50/50 between the worker and the company.
a. Plot the earnings for each scheme.
b. Derive the equations for worker earnings and normalized unit labor costs for each scheme.
c. Find the point at which the two plans break even.
d. Which do you think would the company prefer?
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a b c The two plans breaks even at y 05x 05 y x ...View the full answer
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Related Book For 
Niebels Methods, Standards and Work Design
ISBN: 978-0073376318
13th edition
Authors: Andris Freivalds, Benjamin Niebel
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