Question

Alexander was offered a job that paid a salary of $24,000 in its first year. The salary was set to increase by 4% per year every year. If Alexander worked at the job for 5 years, what was the total amount of money earned over the 5 years, to the nearest whole number?

Answer 1

9514 1404 393

Answer:

$129,992

Explanation:

The sum of a geometric series is given by ...

Sn = a1·(r^n -1)/(r -1)

Here, the first term is 24000, and the growth factor r is 1+4% = 1.04. The sum is then ...

S5 = 24000·(1.04^5 -1)/(1.04 -1) ≈ 129992

The total earned over 5 years was $129,992.

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A spreadsheet can list the annual salaries and add them up. The salary each year is 1.04 times that of the previous year. That is shown in the attachment.