Pam Thompson is offered a salary of 28,000. The company gives annual raises of 6 percent. What would be pam,s salary during her fifth year on the job.
To calculate Pam's salary during her fifth year on the job, we need to apply the 6 percent annual raise for each year.
Step 1: Calculate the salary after the first year:
Salary after the first year = Salary + (Salary * Raise)
Salary after the first year = 28,000 + (28,000 * 0.06)
Salary after the first year = 28,000 + 1,680
Salary after the first year = 29,680
Step 2: Calculate the salary after the second year:
Salary after the second year = Salary after the first year + (Salary after the first year * Raise)
Salary after the second year = 29,680 + (29,680 * 0.06)
Salary after the second year = 29,680 + 1,780.80
Salary after the second year = 31,460.80
Step 3: Calculate the salary after the third year:
Salary after the third year = Salary after the second year + (Salary after the second year * Raise)
Salary after the third year = 31,460.80 + (31,460.80 * 0.06)
Salary after the third year = 31,460.80 + 1,887.65
Salary after the third year = 33,348.45
Step 4: Calculate the salary after the fourth year:
Salary after the fourth year = Salary after the third year + (Salary after the third year * Raise)
Salary after the fourth year = 33,348.45 + (33,348.45 * 0.06)
Salary after the fourth year = 33,348.45 + 2,000.91
Salary after the fourth year = 35,349.36
Step 5: Calculate the salary after the fifth year:
Salary after the fifth year = Salary after the fourth year + (Salary after the fourth year * Raise)
Salary after the fifth year = 35,349.36 + (35,349.36 * 0.06)
Salary after the fifth year = 35,349.36 + 2,120.96
Salary after the fifth year = 37,470.32
Therefore, Pam's salary during her fifth year on the job would be $37,470.32.
To determine Pam's salary during her fifth year on the job, we can use the formula for compound interest to calculate the annual salary increase over the five-year period.
First, let's find out the annual salary increase percentage. The company gives an annual raise of 6 percent, which means the salary will increase by 6 percent each year.
To calculate the salary during the fifth year, we'll use the formula:
Salary during fifth year = Initial salary × (1 + Annual raise percentage)^Number of years
In this case:
- Initial salary = $28,000
- Annual raise percentage = 6% or 0.06 (since it is expressed as a decimal)
- Number of years = 5
Using these values, we can calculate the salary during the fifth year as follows:
Salary during fifth year = $28,000 × (1 + 0.06)^5
Calculating the values inside the parentheses:
(1 + 0.06)^5 = 1.06^5 = 1.338225
Now, let's substitute that value back into the formula:
Salary during fifth year = $28,000 × 1.338225
Calculating the result:
Salary during fifth year = $37,457.30
Therefore, Pam's salary during her fifth year on the job would amount to approximately $37,457.30.