Problem 384
Allen was earning $30,000 working for a small business. The business had a bad year, and Allen was asked to take a 10% cut in pay with the assurance that he would receive a 10% increase in salary the following year. If Allen agreed, what would be his salary in 2 years?
Solution
After cut 10% rest amount = 30000 – 0.10(30000)
= 30000 – 3000
= 27000
10% increment of 27000 , so salary in 2 years = 27000 + 0.10(27000)
=27000 + 2700
=29700