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The table below shows the typical hours worked by employees at a company. A salaried employee makes $\$ 50,000$ per year. Hourly employees get paid $\$ 20$ per hour, but get $\$ 30$ per hour for each hour over 40 hours.




Sun.		Mon.Tues.Wed.Thurs.Fri.Sat.

0		8899.57.54






Which of the payment options would you recommend to a new employee?


AEither one. Hourly and salaried employees earn the same amount per week.
BHourly pay. Hourly employees make more per week than salaried employees.
CSalaried pay. Salaried employees make more per week than hourly employees.
DThere is not enough information given to compare weekly earnings.

Verified Answer :

  • Calculate total weekly hours: \(46\) hours.
  • Calculate hourly weekly pay: \(\$980\).
  • Calculate salaried weekly pay: \(\approx \$961.54\).
  • Compare and conclude: Hourly pay (\(\$980\)) > Salaried pay (\(\approx \$961.54\)), therefore hourly is better.
  • Final Answer: \(\boxed{B}\)

Explanation

  1. Calculate Total Weekly HoursWorked

To determine the best payment option, we must first compare the weekly income provided by the hourly and salaried options. We start by calculating the total hours worked per week using the provided table:
Sun: 0
Mon: 8
Tues: 8
Wed: 9
Thurs: 9.5
Fri: 7.5
Sat: 4
The total hours worked per week is \(0 + 8 + 8 + 9 + 9.5 + 7.5 + 4 = 46\) hours.

  1. Calculate Hourly Weekly Earnings

The company pays hourly employees \(\$20\) per hour for the first \(40\) hours and \(\$30\) per hour for any overtime (hours exceeding \(40\)).
With a total of \(46\) hours worked, the employee has:

  • \(40\) hours at the base rate: \(40 \times \$20 = \$800\)
  • \(46 - 40 = 6\) hours of overtime: \(6 \times \$30 = \$180\)

The total weekly earnings for the hourly option is \(\$800 + \$180 = \$980\).

  1. Calculate Salaried Weekly Earnings

The salaried employee earns \(\$50,000\) per year. To find the weekly earnings, we divide the annual salary by the number of weeks in a year (assuming \(52\) weeks):
\(\$50,000 \div 52 \approx \$961.54\) per week.

  1. Conclusion and Recommendation

Comparing the two earnings:

  • Hourly pay per week: \(\$980\)
  • Salaried pay per week: \(\$961.54\)

Since \(\$980 > \$961.54\), the hourly payment option results in higher weekly earnings for the employee. Therefore, the hourly pay option is recommended. This corresponds to option (b).

Examples

Understanding how to calculate different pay structures is essential for personal financial planning and career decisions. For example, if you are a freelance worker or a contractor, you might encounter different types of compensation models like hourly rates, project-based flat fees, or annual salaries. By calculating the expected weekly or monthly income based on your projected workload, you can effectively compare offers and choose the path that maximizes your income and aligns with your financial goals. This is a fundamental skill in everyday professional life, ensuring that you are adequately compensated for your time and expertise.

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