There is a famous puzzle which some people think hard and others consider easy. No matter what they think, they are usually wrong!
Two men were engaged by a certain firm. Each of them was given a starting salary of £100 a year. Then they were offered the choice between a rise of £20 each year, or a rise of £5 each half-year. One chose the first, and the other the second. Which was the wiser?
It should be immediately obvious that getting a rise of £20 each year is better than a rise of £10 each year. For those that distrust the obvious, consider this table:-
| £5.00 each 6 months | £20.00 each year | |||||
|---|---|---|---|---|---|---|
| Period | Salary | Pay for period |
Running total |
Salary | Pay for period |
Running total |
| Year 1, 1st half | £100.00 | £50.00 | £50.00 | £100.00 | £50.00 | £50.00 |
| Year 1, 2nd half | £105.00 | £52.50 | £102.50 | £100.00 | £50.00 | £100.00 |
| Year 2, 1st half | £110.00 | £55.00 | £157.50 | £120.00 | £60.00 | £160.00 |
| Year 2, 2nd half | £115.00 | £57.50 | £215.00 | £120.00 | £60.00 | £220.00 |