00:01
And hello, this is chapter 12, section 4, problem number 27.
00:07
In this problem, we're told we can ignore the unit so we can stick with that the companies pays 60 for claims the first year.
00:17
And then each year after that, payments are less by 20 % from the previous year.
00:22
And our goal here would be to calculate the total payments.
00:27
And so what we can do is start by the idea of, that we want to write this out.
00:34
So we're going to start with 60 as our first payments for the first year.
00:40
And then to get to the second year, we're going to multiply by, or we're going to make it less by 20%, which means we can multiply by 0 .80.
00:51
In other words, it would be 80 % of the previous year.
00:55
So 80 % of 60, we're going to get a plus 48 for the payments for the next year.
01:01
And then we're going to keep multiplying by 0 .80 to get the following year's payments.
01:07
So the next one's going to be plus 38 .4...