Using the formula above, your merit increase will be 2.5%. You received a score of 3.4 on your annual review. Since the merit increase model is 0.5% salary increase at a score of 2.6, with an additional 1% for every .4 points above that baseline, you get 2.5%, which is the baseline of 0.5% + 2% for the 0.8 points you scored above that baseline.
