Problem
You have just been elected into the "Society of Honorable Engineers." First-year dues are waived in honor of your election. Thus, your first-payment of $200 is due at the end of the year, and annual dues are expected to increase 3% annually. After 40 years you become a life member and no further dues are owed. Instead of paying annual dues, however, you can pay a one-time $2000 life membership fee.
(a) Show the equation for determining the rate of return for buying a life membership. Contributed by D. P. Loucks, Cornell University
(b) What is the rate of return?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.