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Calculus of moving averages I have no idea where to start even though I know thi

ID: 2844897 • Letter: C

Question

Calculus of moving averages

I have no idea where to start even though I know this is fairly simple


Suppose that you plan to start setting aside money each month, but since you don't really trust banks, your "account" is going to be a mayonnaise jar kept hidden in the freezer. Starting at the beginning of the month, you will deposit $4000 in the account and will continue to do so at the beginning of each subsequent month. However, you expect to need to withdraw $3000 from the account each month to pay bills. Given this, w hat is the expected average balance in your account over the course of the next three months? (Hint: Think about how you will withdraw money each month.)

Explanation / Answer

at the end of 1st month balance= $1000

at the end of 2nd month balance= $2000

at the end of 3rd month balance= $3000

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