To determine how the total employment compensation changes, we need to account for the given increases and decreases.
1. Gross Pay Increase: There is a gross pay increase of \[tex]$500.
2. Benefits Increase: Total employee benefits increase by \$[/tex]200.
3. Expenses Decrease: Total job expenses decrease by \[tex]$300.
To find the net change in total employment compensation, we need to add the increases and subtract the decreases. Here are the steps:
1. Add the increase in gross pay (\$[/tex]500) to the increase in benefits (\[tex]$200):
\[
\$[/tex]500 + \[tex]$200 = \$[/tex]700
\]
2. Subtract the decrease in expenses (\[tex]$300) from the previously calculated sum (\$[/tex]700):
[tex]\[
\$700 - \$300 = \$400
\][/tex]
So, the total employment compensation increases by \[tex]$400.
The correct answer is:
a. increases by \$[/tex]400
