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An employee makes $37,500 per year and receives a 5.5% raise. Which of the following is the employee's new salary?

A $39,562.50

The first step is to find the amount of change by multiplying 37,500 by 0.055 (5.5% written as a decimal), which is $2,062.50. The amount of change, added to the original salary, is $39,562.50.
Alternatively, recognize the fact that the employee is now earning 105.5% of what he or she earned before. Calculate the new salary by multiplying 1.055 × 37,500 = 39,562.50.

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