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Problem 1 The average salary for an employee at Acme Corporation is $30,000 per year, with a variance of 4,000,000. This year, management awards the following bonuses to every employee. A Christmas bonus of $500. An incentive bonus equal to 10 percent of

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Problem 1 The average salary for an employee at Acme Corporation is $30,000 per year, with a variance of 4,000,000. This year, management awards the following bonuses to every employee. A Christmas bonus of $500. An incentive bonus equal to 10 percent of
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Problem 1

The average salary for an employee at Acme Corporation is $30,000 per year, with a variance of 4,000,000. This year, management awards the following bonuses to every employee.

A Christmas bonus of $500.

An incentive bonus equal to 10 percent of the employee’s salary.

What is the standard deviation of employee bonuses?

(A) $200

(B) $3,000

(C) $40,000

(D) None of the above.

(E) There is not enough information to answer this question.