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The 2000 dollar contract is more than likely to treat the entire exterior of the home with a termiticide. Termites live in colonies under the ground and use mud tunnels to travel along structures. Just because you are seeing mud tunnels in one specific spot does not mean that they will not affect your home in other areas. This is why the entire exterior of the home should be treated. It will place a protective barrier around the entire structure. Most companies will use a product such as Termidor to effectively kill off the colony.
I recommend that you have a professional apply the chemicals needed to control the termite situation. If cost is an issue, then you can ask them about doing a spot treatment or a baiting system. Also do some research and get a few more quotes. A small company that is run by a local guy may be willing to do the job at a lesser charge. Dont be afraid to bargain on the price. The only costs involved for the pest control company is the termiticide and labor. If they want the job, they will come down.
Feel free to post any follow-up questions you may have.