00:01
All right, this question says, if you've been hired at an annual salary of $42 ,000 and you expect to receive an annual increase of 3%, what will your salary be when you begin your fifth year? so this is an exponential growth function.
00:19
And it's going to grow by 3 % every year.
00:24
So you're looking at your starting salary of $42 ,000 times 1 plus your rate raised to the time.
00:34
Your rate is 3%.
00:35
So you get $42 ,000 times 1 .03 raised to the time.
00:41
The question here, or the tricky part here, is that when you begin your fifth year, you've only worked four years.
00:48
So when you begin your fifth year, your salary is going to be $42 ,000 times 1 .03 raised to the fourth.
00:58
Because at the beginning of your fifth year, you've actually gotten five increases.
01:03
So you're going to go here on the calculator, $42 ,000 times 1 .03 raised to the fourth.
01:13
That's going to give you a salary of $47 ,271 .37...