After two years, the total percentage increase from FTO pay is 10 percent.

After two years, the total percentage increase from FTO pay is 10 percent.

• A. 5
• B. 10
• C. 15
• D. 20

Answer: (B)

When evaluating a cumulative percentage change over multiple years, you usually add the yearly increases to get the total, unless you’re told to compound. If each year adds 5 percent, the two-year total is 5% + 5% = 10%. Note that if you actually apply each year's increase to the new amount (compounding), the total would be 1.05 × 1.05 = 1.1025, which is a 10.25 percent increase. But since the problem states the total increase after two years is 10 percent, the intended interpretation is the simple sum, giving a total of 10 percent.

When evaluating a cumulative percentage change over multiple years, you usually add the yearly increases to get the total, unless you’re told to compound. If each year adds 5 percent, the two-year total is 5% + 5% = 10%.

Note that if you actually apply each year's increase to the new amount (compounding), the total would be 1.05 × 1.05 = 1.1025, which is a 10.25 percent increase. But since the problem states the total increase after two years is 10 percent, the intended interpretation is the simple sum, giving a total of 10 percent.