If your starting salary were $50,000 and you received a 4% increase at the end of every year for 15 years, what would be the total amount, in dollars, you would have earned over the first 16 years that you worked?

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Mathematics

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18 May, 16:23

If your starting salary were $50,000 and you received a 4% increase at the end of every year for 15 years, what would be the total amount, in dollars, you would have earned over the first 16 years that you worked?

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Charisma · Answer 1

n = 16

50000 (1 + 1.04 + 1.04^2 + 1.04^3 + ... + 1.04^15) = 50000 * (1.04^16 - 1) / (1.04 - 1) = 1,091,226.56

Final year's salary = 90047.17

86,583.82 * 1.04 = 90047.17

There are only 15 table when there should be 16.

a_N = 50000 (1.04) ^15 = 90047.17

And if we add 90047.17 to the previous total of 1001179.38 we get

$1,091,226.55