Consider the recurrence relation below.
`V_0 = 10\ 000,\ \ \ \ \ V_(n + 1) = 1.04 V_n + 500`
This recurrence relation could be used to model
- a reducing balance depreciation of an asset initially valued at $10 000.
- a reducing balance loan with periodic repayments of $500.
- a perpetuity with periodic payments of $500 from the annuity.
- an annuity investment with periodic additions of $500 made to the investment.
- an interest-only loan of $10 000.