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Question: what is the working required to achieve these answers please...

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(a Mr Ronaldo has the fortune of been the sole heir to a wealthy grandfather that recently passed away and left him with S1 million cash. His grandfathers will stated that he may choose between getting the cash immediately or $100,000 per year for the next 20 years. He decided on the later and are considering the following two saving and spending options: Option 1: He save the cash inheritance for the first 7 years and then spend the remaining inheritance for the next 13 years. Option 2: He does the reverse, spend for 7 years and then save for 13 years. (Note: all cash flows occur at the end of the year). Given that the interest rate is at 7%, determine how much would Mr Ronaldo has at the end of 20 years for both Option 1 and Option 2 AFVOption 1 2,085,4401 F Option 2-2,014,600 [5 marks] Calculate the interest rateon his savings that will make the above two options equivalent(Hint: use trial and error method with initial 6% interest rate) A: 1-б. 593490

What is the working required to achieve these answers? please clarify all steps.

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