Interest and Financial Models

iterations of money spent AFTER the rebate (we will label the rebate as iteration 0 ). economy through the eleven iterations (from Iteration 0 to Iteration 10). Excluding the original rebate, the money injected into the economy through Iteration 6 from citizens alone totaled $ Excluding the original rebate, the money injected into the economy through Iteration 8 from citizens alone totaled $ Excluding the original rebate, the money injected into the economy through Iteration 10 from citizens alone totaled & 1+r+r2+r3++rn1=(1rn)/(1r). Then, if A is any other real number, we may distribute which gives A+Ar+Ar2+Ar3++Arn1=A(1rn)/(1r). These sums are referred to as Geometric Series (GS). The formula to compute the sum has many applications. For example, it may be used to develop the formula for the value of an annuity. Now, apply the GS formula to Echo Island and use it to compute the sum of all money injected into the economy over all iterations in the applet. To do so, we need to use the formula A+Ar+Ar2+Ar3++Arn1=A(1rn)/(1r). Where the values to input for the variables should be: A=r=n= (e) Now, substitute the values from part (d) into the formula and evaluate. This gives 2405+2405(0.8)+2405(0.8)2++2405(0.8)111=(1(0.8)11)/=