Question

The starting salary of a starting teacher is $40,000, which will increase by 2% each year.

What would this teacher’s salary be after 8 years of teaching round to the nearest dollar.

Answer 1

$46,866

Explanation:

Use the compound amount equation A = P(1 + r)^t, where r is the annual interest as a decimal fraction.

Here we have A = ($40,000)(1 + 0.02)^8, or

A = A = ($40,000)(1.02)^8 = $46,866