Question

Rita has deposited $1000 in a bank account. At the end of each year, the bank posts interest to her account in the amount of 5% of the balance, but then takes out a $10 annual fee.

Let bo be the amount Rita deposited. Write a recursive equation for the balance.

Answer 1

5% of $1000 is $50 bringing up her balance to $1050 minus the $10 fee at the end the year making her balance $1040.
For year 2 it will be $1082
For year 3 it will be $1126.10
For year 4 it will be $1172.41
For year 5 it will be $1231.03