This means you have to round off this number for the hundredth place.

2.738

Compare the digit 8 to 5.

Whether it is <, > than 5.

If the digit is less than 5, you convert the right side of the digit to zero.

If the digit is more than 5, you increase the digit by 1 and convert the right side of the digit to zero.

In case of 2.738

The digit 8 is more than 5 therefore, we will increase the digit by 1, and thus 2.74 will be the answer.