Question

Rita is applying for a job as an engineer. Her starting salary at Company A will be $80,000 with an $800 yearly raise. Her starting salary at company B will be $65,000 with a 5% increase each year. If Rita is working at a company for 5 years. Which company should she pick?

Answer 1

Given:

In company A, starting salary is $80,000.

The yearly increment is $800.

So,

80,000+800=80,800

80,800+800=81,600

81,600+800=82,400

82,400+800=83,200

83,200+800=84,000

So, at the 5 year, she will get $84,000

In company B,

The initial salary is $65000 with a 5% increase each year.

So,

`\begin{gathered} 65000*(105)/(100)=68250 \\ 68250*(105)/(100)=71662.5 \\ 71662.5*(105)/(100)=75245.625 \\ 75245.625*(105)/(100)=79007.906 \\ 79007.906**(105)/(100)=82958.30 \end{gathered}`

In the 5th year, she will get $82,958.30.

If Rita is working at a company only for 5 years, then she would choose company A. Because she will get salary in company A more than company B.

But, if she works for more than 5 years, she will get a salary in company B more than company A.