Im confused how to solve this???

Question

Terry is given two salary options by his employer. The first option is a starting salary of $20,000 that

increases by $500 each year he is with the company.

The second option is a starting salary of $20,000 that increases by 2.2% each year he is with the company.

How many years will Terry have to be with the company for the salary with the second option to be

greater than the salary with the first option? SHOW ALL WORK!

A.11 B.12 C. 13 D. 14

Answer 1

500/.022=22.727..........yrs

Here's a formula: fv=p(1+.022/2)^(nt)

20,222(1.022)^1=20,440

n=yrs 2=20,889

1.5=20,63

1.25=20,551

1.125=20,495

1.126=20,496

1.135=20,500

future value

premium

int

compound

years

times/yr

Answer 2

If you have a TI graphing calculator, you could graph the two option and find when the exponential is higher than the line.

The equations would be y1=20,000 + 500x and y2=20,000 + 2.2^x

Or you could plug in 11,12,13 and 14 in for x for each equation until the y2 gave you a larger value.