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QUESTION TWO Koronya has won a Roton lottery and will receive the following cash inflows: Year 1 Sh 200,000 Year 2 Sh 500,000 Total Sh

QUESTION TWO

Koronya has won a Roton lottery and will receive the following cash inflows:

Year 1 Sh 200,000

Year 2 Sh 500,000

Total Sh 700,000

If interest rate is 6% compounded annually, what is the present value of the Roton earnings?

If the interest rate is 6% compounded quarterly, what is the present value of the Roton earnings?

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