Final answer:
The final hourly wage after a 6% increase each year for 7 years from a starting wage of $10.50 is calculated using compounded increase. Converting the percentage to a decimal and using the compound interest formula, the final wage is approximately $15.76.
Step-by-step explanation:
To find the final hourly wage after a 6% increase each year for 7 years from a starting wage of $10.50, we can use the formula for compound interest, which is similar to calculating compounded percentage increase. The formula is Final Wage = Starting Wage * (1 + rate)^years, where the rate is the annual increase rate as a decimal and years is the number of years the wage increases.
First, we convert the 6% increase to a decimal by dividing by 100, which gives us 0.06. Then we apply the formula: Final Wage = $10.50 * (1 + 0.06)^7.
By calculating this, we'll find that the final wage after 7 years is approximately:
Final Wage = $10.50 * (1.06)^7
Final Wage = $10.50 * 1.5007
Final Wage ≈ $15.76
Therefore, the final hourly wage after 7 years would be approximately $15.76.