Question

A worker has four different job offers, each with a contract for six years. Assuming the job descriptions are identical,

Answer 1

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Answer:

  $48,000 to start, with 6% raises

Step-by-step explanation:

The starting salaries are within a few percentage points of each other, so the majority of the difference in earnings will come because of the raises. The offer with the largest raise percentage is likely the best.

The earnings total can be figured as the sum of a geometric series with a first term of "starting salary" and a growth factor of (1+raise percentage). For starting salary 's' and raise percentage 'r', the total earnings in 6 years will be ...

  S = s((1+r)^6 -1)/r

Here are the total earnings, in thousands, for each of the offers:

  a) s = 49, r = .03, S = 316.95

  b) s = 51, r = .01, S = 313.75

  c) s = 48, r = .06, S = 334.82 . . . . best offer

  d) s = 50, r = .02, S = 315.41

The worker can earn the most from a starting salary of $48,000 and 6% increases each year.

Answer 2

C) a starting salary of $48,000 with a 6% increase each year