If  your  starting  salary  is  $40,000  and  you  receive  a  4.2%  raise  every  year,  how  much  total  money  will  you  make  in  15  years?

The first year, the amount is 40,000

the second year is 40000 + 4.2% of 40000, or 0.042 * 4000, so 40000+(0.042*4000)
common factoring that  we get 40000(1 + 0.042), or just 40000(1.042)

in short, the starting amount is 40000, and to get the next term's value you'd use the "common ratio" of 1.042, namely the multiplier of 1.042.

for the third year it'll be 40000(1.042) + (0.042 *40000(1.042) ), again, common factoring that

40000(1.042)(1 + 0.042) or 40000(1.042)(1.042) or 40000(1.042)²

therefore,