Model and analyse fixed-change finance

Let the equipment loan with no repayments during the modelled period be represented by a first-order recurrence model

\(V_n\) is the loan balance, in dollars, after \(n\) years. \(V_0\) is the value at the start, so \(n\) counts the number of rule applications

The initial principal is \$12{,}000. Simple interest at 5.9% p.a. adds the same amount each year.