Anwer: (2) 

Solution:

let’s say sum is 100. 

Then amount after 3 years = 100(1+0.1)^3 = 133.1

let’s say x is paid at the end of 1st year. Future value that is After 2 year value of x = (1+0.1)^2x = 1.21x

then x is paid at the end of 2nd year. Future value that is After 1 year value of x = 1.1 x

and at the end 3rd year again x

So total future value of installments = (1.21+1.1+1)x = 3.31x

hence 3.31x = 133.1

x = 133.1/3.31 = 40.2

But actual installment is 500

So actual sum is = (500/40.2)*100 = 1239.7