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Serge’s graduated commission scale pays him 3% on his first $30,000 in sales, 4% on the...

Serge’s graduated commission scale pays him 3% on his first $30,000 in sales, 4% on the next $20,000, and 6% on all additional sales in a month. What is his average commission rate on sales for a month totalling: a. $60,000? b. $100,000? View Solution:
Serge s graduated commission scale pays him 3 on his first

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Answer #1

Average commission rate on sale for %60000 sales.

Commission on first $30000 sales = 3% * 30000 = $900

Commission on next $20000= sales = 4%*20000 = $800

Commission on $10000 sales = 6%*10000 = $600

Total commission = 900+800+600 = $2300

Average commission rate = 2300 / 60000

= 3.83%

Average commission rate on sale for $100000 sales.

Commission on first $30000 sales = 3% * 30000 = $900

Commission on next $20000= sales = 4%*20000 = $800

Commission on $50000 sales = 6%*50000 = $3000

Total commission = 900+800+3000 = $4700

Average commission rate = 4700 / 100000

= 4.7%

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