Question

“Your salary is $25,000 and you will be receiving a 2.5% pay increase this year. What will your new salary be?”

Answer 1

If your current salary is the 100%, and you get a 2.5% increase, that means the new salary would be 102.5% of 25,000. This percentage could also be written as 1.025, which you would multiply to 25,000 to get your new salary.

1.025 · 25,000 = 25,625

Therefore, your new salary would be $25,625