1 of 8 0-day streak

Analyse balances and graphs of an affine cash-flow model

Question 1 of 8

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The following data describe the community reserve fund at the end of each period. Let $V_n$ be the fund balance in dollars after $n$ periods. $V_0$ is before the first interest calculation and cash flow

The nominal annual interest rate is 6%, compounded annually. An addition of $110.80 is made at the end of each year, after interest

The initial balance is $30,500. A short table from the model is shown below

The entries are displayed to the nearest cent
Period n	fund balance ($)
0	$30,500
1	$32,440.80
2	$34,498.05

Use the exact recurrence for the calculations. Displayed money values are rounded to the nearest cent only at the point where they are shown

2 marks

Calculate the missing balances for the listed periods

Money values are rounded to the nearest cent after the exact recurrence is evaluated
Period n	fund balance ($)
0	$30,500
1	$32,440.80
2	?
3	?

$V_{2}$ at period 2 $V_{3}$ at period 3