Question

Suppose $LaTeX: S=\frac{d}{1+k}+\frac{d(1+g)}{(1+k)^2}+\frac{d(1+g)^2}{(1+k)^3}+...+\frac{d(1+g)^n}{(1+k)^{n+1}}$ , obtain the value of S if d=7, g=0.04, k=0.07, and n=22. Round your final answer to two decimal places.

Answer 1

S = D/(1+k) + d*(1+g)/(1+k)² + d*(1+g)²/(1+k)³ + ......d*(1+g)ⁿ/(1+k)ⁿ⁺¹

= 7/(1+0.07) + 7*(1+0.04)/(1+0.07)² + 7*(1+0.04)²/(1+0.07)​​​​​​³.......+ 7*(1.04)²²/1.07²³ = 112.02

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