Why does a thief skimming a fixed amount each day leave a bank account with exactly one balance, and everything else running away from it?
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Building the model from
Start from continuously compounded interest, subtract the embezzlement as a constant time rate , and record the distinction between a fixed amount per day () and a fixed fraction of the balance ().
The single critical point
Solve , write down the one constant solution , and state what it means for the account: interest earned exactly equals the amount embezzled.
Sign of and the balance curves
Graph the line of slope and intercept against , mark the arrows on each side of , and sketch balances above it growing, and below it falling, ever faster.