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Question 2 Your brother promised RM5,000 over five years to you as a gift. The money will be given to you at the end of

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Question 2 Your brother promised RM5,000 over five years to you as a gift. The money will be given to you at the end of the respective year. Consider the three following alternative: Alternative 1: Your brother provides RM1,000 per year for five years. Alternative 2: Your brother provides RM500 per year in year one and two; RM1,000 in year three, and RM1,500 in year four and five. Alternative 3: Your brother provides RM1,500 in year one, RM1,000 in year two, three and four, and RM500 in year five. If discount rate is 8% per year, which alternative do you prefer? Explain your answer. (Hint: you need to support your answer by showing relevant workings]

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