What is the present value of the following cash flow stream at a rate of 6.25\%?\newline\begin{align*}\text{Year 1:} &\quad \$1,000 \\\text{Year 2:} &\quad \$1,500 \\\text{Year 3:} &\quad \$2,000 \end{align*}\text{(Round your answer to the nearest dollar.)}

Step 1: Understand the concept of present value (PV). Present value is the current worth of a future cash flow or series of cash flows, discounted at a specific interest rate. The formula for PV is: \( PV = \frac{FV}{(1 + r)^n} \), where \( FV \) is the future value, \( r \) is the discount rate, and \( n \) is the number of periods.