Gross pay amount = $40,000
Percentage of the gross pay saved = 20%
Amount of gross pay saved per year = 20% of 40,000
Amount of gross pay saved per year = 20/100 * 40,000
Amount of gross pay saved per year = 20*400 = $8000
This means that $8000 is saved per year.
Next is to calculate the number of years it will take to save $16,000
Let us use the equality postulate;
1 year = $8,000
x year = $16,000
cross multiply
8000x = 16000
x = 16000/8000
x = 2
This means that it will take 2 years for me to achive my goal.
