A variable-rate mortgage of $150 000 is amortized over 20 years by equal monthly payments. After 18 months the original interest rate of 6% compounded semiannually was raised to 6.6% compounded semi-annually. Two years after the mort- gage was taken out, it was renewed at the request of the mortgagor at a fixed rate of 5.65% compounded semi-annually for a 4-year term.
(a) Calculate the mortgage balance after 18 months.
(b) Compute the size of the new monthly payment at the 6.6% rate of interest.
(c) Determine the mortgage balance at the end of the 4-year term.