how did they get 3100?

MONTOWN Score of Problem 5-31 (bookmatch) 13 018 (11 completel HW Score: 73333 05 years year 10 years 2 years 40 What is therefore the 100 doleath of years 1.27you wont lysinge wuty for which court should you ? you on the check All parts $ 4 % 5 1 0 2 3 1 7 9 8 6 w F R . Y U The rates given are Year 1 Year 2 1.99% Year 3 2.41% 2.74% rate Cash flow 100 100 100 the presnet value would be 100/(1+0.0199)^1 + 100/(1+0.0241)^2 + 100/(1+0.0274)^3 285.61 100 Now we can use the excel formula or fiancial calculator to calculate the rate PMT (periodic payment) PV (present value) 285.61 N(number of period) Compute 1/ (interest rate) 3 RATE(3,100,-285.61) 2.49862% the effective discount rate would be 2.49862%