Question

Luke earned $36,000 during the first year of his job at Putt-Putt Kingdom. After each year he received a 10% raise. Find his total earnings during the first five years on the job.

Answer 1

In order to solve this problem, you need to use a geometric series:

`S_(n) = ( a_(1)(1 - r^(n)) )/(1 - r)`
where:
a₁ = first term of the series = 36000
r = common rate = 10% raise, therefore 1.10
n = number of terms = 5

Therefore,

`S_(n) = ( 36000(1 - 1.10^(5)) )/(1 - 1.10)`
= 219783.60 $

Luke's total earnings in five years are 219783.60 $.