Obviously, the lifetime membership isnt a good deal if you only remain a member for a couple of years, but if you remain a member for 40 years, its a great deal. Suppose that the appropriate annual interest rate is 7.5%. What is the minimum number of years that Lloyd must remain a member of the ADLA so that the lifetime membership is cheaper (on a present value basis) than paying $550 in annual membership dues? (Note: Round your answer up to the nearest year.)

14 years

21 years

16 years

12 years

In 1626, Dutchman Peter Minuit purchased Manhattan Island from a local Native American tribe. Historians estimate that the price he paid for the island was about $24 worth of goods, including beads, trinkets, cloth, kettles, and axe heads. Many people find it laughable that Manhattan Island would be sold for $24, but you need to consider the future value (FV) of that price in more current times. If the $24 purchase price could have been invested at a 5% annual interest rate, what is its value as of 2018 (392 years later)?

$5,586,172,178.09

$4,128,909,870.77

$6,411,954,152.25

$4,857,541,024.43