Buying a "vacation timeshare" means buying the right to use a vacation property for a fixed period each year. Suppose that you pay $900 for a vacation timeshare and receive a "money-back guarantee" that at any time the company will buy back your timeshare, or if not, give you a $1800 bond. The deception, however, is that the bond is not redeemable for 45 years. Find the real value of the "guarantee"—that is, find the present value of $1800 in 45 years (assume a 4% interest rate compounded annually). (Round your answer to the nearest cent.)
$ _____________

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Finding present value of compounded amount A person purchases a timeshare for a given amountThe comp... View the full answer