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When Sean joined a sales company he was offered a choice of two different salary contracts - Leaving Cert Mathematics - Question 1 - 2018

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When Sean joined a sales company he was offered a choice of two different salary contracts. The details of the contracts are outlined in the table below. Contract A... show full transcript

Worked Solution & Example Answer:When Sean joined a sales company he was offered a choice of two different salary contracts - Leaving Cert Mathematics - Question 1 - 2018

Step 1

Find how much Sean would earn under each contract in a year where his total sales were €400,000.

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Answer

For Contract A, the total earnings can be calculated as follows:

  1. Salary from Contract A: €35,000

  2. Commission from sales:

    extCommission=0.02imes400,000=8,000 ext{Commission} = 0.02 imes 400,000 = €8,000
  3. Total Income from Contract A:

    =35,000+8,000=43,000= 35,000 + 8,000 = €43,000

For Contract B, the total earnings are calculated similarly:

  1. Salary from Contract B: €30,000

  2. Commission from sales:

    extCommission=0.03imes400,000=12,000 ext{Commission} = 0.03 imes 400,000 = €12,000
  3. Total Income from Contract B:

    =30,000+12,000=42,000= 30,000 + 12,000 = €42,000

Step 2

Find her total sales for that year.

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Answer

To find Mary's total sales, we need to calculate as follows:

  1. Given that Mary earned €50,000 in total from Contract A, the relationship can be expressed as:

    extTotalEarnings=extSalary+extCommission ext{Total Earnings} = ext{Salary} + ext{Commission}
  2. Salary from Contract A: €35,000; hence,

    50,000=35,000+0.02x50,000 = 35,000 + 0.02x

    where x is the total sales.

  3. Rearranging gives:

    50,00035,000=0.02x50,000 - 35,000 = 0.02x 15,000=0.02x15,000 = 0.02x
  4. Solving for x:

    x = rac{15,000}{0.02} = 750,000

Therefore, Mary's total sales for that year were €750,000.

Step 3

Find the total sales for which a salesperson would earn the same amount of money under each contract.

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Answer

To find the total sales (x) where both contracts yield the same income:

  1. For Contract A:

    extTotalIncome=35,000+0.02x ext{Total Income} = 35,000 + 0.02x
  2. For Contract B:

    extTotalIncome=30,000+0.03x ext{Total Income} = 30,000 + 0.03x
  3. Set the two equations equal to each other:

    35,000+0.02x=30,000+0.03x35,000 + 0.02x = 30,000 + 0.03x
  4. Rearranging gives:

    5,000=0.01x5,000 = 0.01x
  5. Solving for x:

    x = rac{5,000}{0.01} = 500,000

So, a salesperson would earn the same amount under each contract when their total sales are €500,000.

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