Question

Justin just started his first post-college job at bigchem, incorporated. part of his benefit package is a defined benefit plan that is based on his salary in his last year of employment. he's wondering what his final salary will be. if his starting salary is $50,000 and he receives a raise of 2.7% per year every year for 43 years what will his ending salary be?

Answer 1

His pay in the end will be 108,050

Answer 2

Calculations are as follows:

Starting Salary= $50000

Yearly Raise= 2.7% of $50000 i-e 50000*0.027= $1350

Justin receives this raise for 43 years i-e 43*1350= $58050

So Justin's ending salary will be: $50000 + $58050= $108050