A new oil well produces 12 000 m3month of oil Its production

A new oil well produces 12 000 m^3/month of oil. Its production is known to be dropping by 2.5% each month. a) What is the total production in the first year? b) Determine the total production of the well.

Solution

a1 = 12000

common ratio r = 100 - 2.5 = 97.5 = .975

a) applying sum of geometric sequence formula

S12 = 12000 ( 1 - .975^12 ) / ( 1- .975 )

= 125761

total production in 1st year is 125761 m^3

b) total production is

S = 12000/ 1- .975

= 480000 m^3