Question

Stu takes a job with a starting salary of $65,000 for the first year. He earns a 2% increase each year. How much does Stu make over five years?

$325,000
$331,500
$338,263
$358,826

Answer 1

Stu makes $338,263 over five years.

Explanation:

In order to find the total amount Stu would make after five years, you need to find out how much he will make each year based on the 2% increase. Starting with year 1 at $65,000, we need to take his total salary and multiply by 1.02 (or the whole salary plus an increase of 2%). So, in year 2, he would make $66,300. Again, we would take his year 2 total salary and multiply by 1.02 to get $67,626 for year 3. We apply these same steps to years four ($68,978.52) and five ($70,358.10). To find his income over the five years, we need to add his salary from all five years together to get a total of $338,263.

Answer 2

Option C which is $ 338,263

Explanation:

The salary for the first year = $65,000

Increase per year= 2 %

To find total money made in five years = ?

total earned in first year = $65,000

Total increase in money after first year = 2 % of 65,000

=
`(2*65000)/(100)`

=$ 1300

Total earned in second year = 65,000 + 1300

= $ 66,300

Total increase in money after second year = 2 % of 66,300

=
`(2*66300)/(100)`

=$ 1326

Total earned in third year = 66300 + 1326

= $ 67,626

Total increase in money after third year = 2 % of 67,626

=
`(2*67626)/(100)`

=$ 1352.52

Total earned in fourth year = 67626 + 1352.52

= $ 68978.52

Total increase in money after fourth year = 2 % of 68978.52

=
`(2*68978.52)/(100)`

=$ 1379.58

Total earned in fifth year = 68978.52 + 1379.58

= $ 70358.1

Total Made in all five years = 65000+66300+67626+68978.52+70358.1

= $ 338262.62

≅$ 338,263