Grace recently graduated from college and purchased an apartment for $210,000 in London. She paid 10% of this amount as a down payment and received a mortgage for the rest of the amount for 25 years. The interest rate on the mortgage was fixed at 4.5% compounded semi-annually for the first five years.

a. What is the monthly payment amount?

b. What is the principal balance at the end of the five- year term?

c. What is the monthly payment amount if the mortgage was renewed for another five-year fixed term at 5.05% compounded semi-annually?

AppendixLO1