Quote:
Originally Posted by xplicitator
Since on the time diagram, we are at time 6. If you wrote 200 * (annuity immediate with n=10), then you are saying that starting at time 8, only payments of 200 are made. But in reality, at time 68, it's still 200, but starting with time 9, payments are 400 each rather than just 200. So 200(v + v^2) accounts for time 6 to 8 and then 400(v + v^2 + ....+ v^8) starting at time 9. Hope that helps!

You need a v^2 multiplying the second series.