Nelson Company owes money to Nash Company for the purchase of equipment. Nash Company has given Nelson the following payment options:

1. I. Immediate payment in full of $34,000.
2. II. Annual payments of $13,000 made at the end of each of the next three years.
3. III. A single payment of $44,000 made at the end of three years.

Assume that both Nelson and Nash use a 10% interest rate compounded annually. What option would Nash prefer, and what is the present value of that option?

Multiple Choice

• Option II, $32,331.
• Option III, $33,044.
• Option III, $31,160.
• Option I, $34,000.
• Option I, $31,538.