Use the Table for the Question(s) Below -The Present Value (PV) of Receiving $1000 Per Year with Structure

question 6

Multiple Choice

Use the table for the question(s) below.
Suppose the term structure of interest rates is shown below:
$\begin{array} { l c c c c c c } \hline \text { Term } & \text { 1 year } & \text { 2 years } & \text { 3 years } & \text { 5 years } & \text { 10 years } & \text { 20 years } \\\hline \text { Rate } & & & & & & \\( \text { EAR\%) } & 5.00 \% & 4.80 \% & 4.60 \% & 4.50 \% & 4.25 \% & 4.15 \% \\\hline\end{array}$
-The present value (PV) of receiving $1000 per year with certainty at the end of the next three years is closest to:

• A) $2723
• B) $2733
• C) $2744
• D) $2737