College Algebra 7th Edition

Published by Brooks Cole
ISBN 10: 1305115546
ISBN 13: 978-1-30511-554-5

Chapter 8, Sequences and Series - Section 8.1 - Sequences and Summation Notation - 8.1 Exercises - Page 602: 80

Answer

$\$9088.67$

Work Step by Step

Let's note by $A_n$ the balance after $n$ months. a) At the end of the first month she pays $200$ from a total of $10,000+0.005(10000)=1.005A_0$, so $$A_1=1.005A_0-200.$$ At the end of the $n$th month she pays $200$ from a total of $A_{n-1}+0.005A_{n-1}=1.005A_{n-1}$, so $$A_n=1.005A_{n-1}-200.$$ b) We determine $A_n$: $$\begin{align*} A_n&=1.005A_{n-1}-200\\ &=1.005(1.005A_{n-2}-200)-200\\ &=1.005^2A_{n-2}-1.005(200)-200\\ &=1.005^2(1.005A_{n-3}-200)-1.005(200)-200\\ &=1.005^3A_{n-3}-1.005^2(200)-1.005(200)-200\\ &=.......\\ &=1.005^nA_{0}-1.005^{n-1}(200)-1.005^{n-2}(200)-\dots -200\\ &=1.005^nA_{0}-200(1.005^{n-1}+1.005^{n-2}+\dots+1)\\ &=1.005^nA_{0}-200\cdot\dfrac{1.005^n-1}{1.005-1}\\ &=1.005^nA_{0}-40,000(1.005^n-1). \end{align*}$$ We calculate $A_6$: $$A_6=1.005^6(10,000)-40,000(1.005^6-1)\approx 9088.67.$$
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