21. Shufen is given a choice of two new salary schemes after a promotion.

Scheme A: 12% increase of her current monthly salary
Scheme B: 8% increase of her current monthly salary + [tex]$1000 annual bonus

(a) If Shufen's current monthly salary is $[/tex]2400, which of the two schemes is better?

(b) Suggest a possible amount for Shufen's current monthly salary if she were to accept Scheme B because it is a better offer. Support your answer with calculations.



Answer :

Certainly, let's break down the problem step by step:

Part (a):

Shufen has two schemes to choose from for her new salary.

1. Scheme A: Shufen gets a 12% increase in her current monthly salary.
2. Scheme B: Shufen gets an 8% increase in her current monthly salary plus a [tex]$1000 annual bonus. Given: - Shufen's current monthly salary is $[/tex]2400.

Calculation for Scheme A:

- Current monthly salary = [tex]$2400 - Increase under Scheme A = 12% of $[/tex]2400 = 0.12 * [tex]$2400 = $[/tex]288
- New monthly salary under Scheme A = [tex]$2400 + $[/tex]288 = [tex]$2688 Calculation for Scheme B: - Current monthly salary = $[/tex]2400
- Increase under Scheme B = 8% of [tex]$2400 = 0.08 * $[/tex]2400 = [tex]$192 - New monthly salary excluding bonus = $[/tex]2400 + [tex]$192 = $[/tex]2592
- Total annual salary under Scheme B = Monthly salary for 12 months + [tex]$1000 bonus = $[/tex]2592 * 12 + [tex]$1000 = $[/tex]31104 + [tex]$1000 = $[/tex]32104
- New effective monthly salary under Scheme B = [tex]$32104 / 12 ≈ $[/tex]2675.33

Comparison:
- New monthly salary under Scheme A = [tex]$2688 - New effective monthly salary under Scheme B ≈ $[/tex]2675.33

Since [tex]$2688 (Scheme A) is greater than $[/tex]2675.33 (Scheme B), Scheme A is the better option for Shufen.

Part (b):

To find the new current monthly salary that makes Scheme B better, let's set up the inequality where the annual salary with Scheme B should be more than the annual salary with Scheme A.

Recall:
- New monthly salary under Scheme A = [tex]$2688 - Annual salary with Scheme A = $[/tex]2688 * 12 = [tex]$32256 Let \( x \) be the new current monthly salary when Scheme B becomes better: - Scheme B annual salary with \( x \): - Monthly salary after 8% increase = \( x * 1.08 \) - Annual salary under Scheme B = \( 12 (x 1.08) + 1000 \) For Scheme B to be better than Scheme A: \[ 12 (x 1.08) + 1000 > 32256 \] Solve the inequality: \[ 12 (x 1.08) + 1000 > 32256 \] \[ 12 (x 1.08) > 32256 - 1000 \] \[ 12 (x 1.08) > 31256 \] \[ x * 1.08 > 31256 / 12 \] \[ x * 1.08 > 2604.6667 \] \[ x > 2604.6667 / 1.08 \] \[ x > 2411.7284 \] Thus, to make Scheme B the better option, Shufen's current monthly salary should be more than approximately $[/tex]2411.73.

So, a possible amount for Shufen's current monthly salary if she were to accept Scheme B to make it the better offer would be anything above approximately $2411.73.