We have been given that Joey plans to invest $2,000 at the end of every year for 3 years. The interest rate on the account is 2.05% compounding annually.
We will use present value formula to solve our given problem.
, where,
,
,
.
Let us convert our given rate in decimal form.
Upon substituting our given values in above formula we will get,
Therefore, the present value of the investment will be $5762.15 and option B is the correct choice.