When is the formula $$S_{\infty} = \dfrac{a}{1-r}$$ valid?
Does |$r| <1$?
When is the formula $$S_{\infty} = \dfrac{a}{1-r}$$ valid?
Does |$r| <1$?
Yes, indeed, you are correct in your suspicion: So long as $\; −1<r<1,\;$ the formula $$ S_\infty = \sum_{k=0}^\infty ar^k = \frac{a}{1-r}$$
holds for a geometric series.
Since I found this very useful when learning geometric series, I'll show you this to enhance your understanding of the formula:
Given a finite geometric sequence, let's say exempli gratia that it has 5 terms. So the terms are $a, ar, ar^2, ar^3, ar^4$. We want to find the sum of this sequence:
$x = a + ar + ar^2 + ar^3 + ar^4$
Multiply through by r:
$xr = ar + ar^2 + ar^3 + ar^4 + ar^5$
Subtract (2) from (1) to get $x(1 - r) = a - ar^5 \rightarrow x = \frac {a(1 - r^5)}{1-r}$
So that's why the formula is why it is. Thus, when you have an infinite geometric series, it only holds when $\lim_{n \rightarrow \infty} r^n = 0$, which occurs when $|r| < 1$