Jessica opened an apparel shop five years ago. In the first year, she made a profit of $3,125. Each year after that, her profit was 20 percent more than in the previous year. What is the total profit Jessica earned in 5 years?

a. $32,400

b. $23,255

c. $7,776

d. $6,480

Hello there.

Jessica opened an apparel shop five years ago. In the first year, she made a profit of $3,125. Each year after that, her profit was 20 percent more than in the previous year. What is the total profit Jessica earned in 5 years?

d. $6,480

If in the first year, she made a profit of $3,125 then each year after that, her profit was 20 percent more than in the previous year. So,

second year

$3,125 (0.20) = $625

$3,125 + $625 = $3,750

third year

$3,750 (0.20) = $750

$3,750 + $750 = $4,500

fourth year

$4,500 (0.20) = $900

$4,500 + $900 = $5,400

fifth year

$5,400 (0.20) = $1,080

$5,400 + $1,080 = $6,480

The total profit Jessica earned in 5 years is $6,480. The answer is letter D.