You Require an 8% Annual Return on All Investments

Multiple Choice

You require an 8% annual return on all investments. You have been offered an investment which will pay you $1,000 in one years time, $2,000 in two years time, and $3,000 in three years time. What is the most you would be willing to pay for this investment?

A) $6,000
B) $2,577
C) $5,022
D) $4,763