Hi,

In one part of the interview, this is a solution:

The interviewee should be able to estimate the fact that **$100*(1 + 20%)^5 is something like $250 off the cuff**. **Without compounding**, it’s obviously **$200 exactly**, so the **answer “something a bit more than $200” is good**. Many people answer $200 exactly and, when prompted “is it more or less than $200” choose “less”, which is clearly madness.

Three questions:

1) How should I be able to estimate that this is 250$?

2) If I estimate in that the worth in 5 years will be 100$ + 5*20%(100$), how should I know if it the number should be higher or lower than 200$?

3) In this case, would you do the whole math or simplify it?