A contract requires payments of $1,500, $2,000, and $1,000 in 100, 150, and 200 days, respectively, from today. What is the value of the contract today if the payments are discounted to yield a 3.5% simple interest rate of return?

Discounted

A reduction applied to a price or rate, lowering the original amount.

Simple Interest Rate

The percentage of the principal amount that is paid as interest for a specified period.

Contract

A contract that is recognized and can be enforced by law, formed between two or more participants.