Question

Pitting olives is offering you a starting salary of $65,000 with a 5% raise annually. Whole olive foods wants to offer you $68,000 with a 3% raise. Who will offer a higher salary after five years.

Answer 1

Answer:

Pitting Olives will offer a higher salary after 5 years.

Step-by-step explanation:

Increase in salary will be an exponential process.

Every year salary with a yearly increase of r% will be given by expression,

A = $A_{0}(1+\frac{r}{100})^{t}$

Here $A_0$ = Initial salary

t = duration in years

After 5 years salary offered by Pitting olives

= $65000(1+\frac{5}{100})^{5}$

= $65000(1.05)^{5}$

= $82958.30

With the same formula, salary offered by Whole Olive foods will be

= $68000(1+\frac{3}{100})^5$

= $68000(1.03)^5$

= $78830.64

Therefore, Pitting Olives will offer a higher salary after 5 years.