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Suppose the term structure of interest rates is shown below: 1 year Term Rate (EAR%5.00% 2 years 4.80% 3 years 4.60% 5 years 4.50% 10

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Suppose the term structure of interest rates is shown below: 1 year Term Rate (EAR%5.00% 2 years 4.80% 3 years 4.60% 5 years 4.50% 10 years 4.25% 20 years 4.15% The NPV of an investment that costs $2700 and pays $1000 certain at the end of one, three, and five years is closest to: 21.47 0 -71.38 $1665.62 -100.26

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