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1. (a) Mrs. Wong is buying an apartment and must borrow So dollars. She takes a T-year mortgage with annual payments of k dollars per
1. (a) Mrs. Wong is buying an apartment and must borrow So dollars. She takes a T-year mortgage with annual payments of k dollars per year, and borrows money at a fixed interest rate of r per year. Assume continuous compounding and continuous mortgage payments. By solving a differential equation, determine Mrs. Wong's annual payments k in terms of So, r and T The solution is 8 pts) (b) Determine the solution for k in the limit T oo. The solution is 1 pts (c) Determine the solution for k in the limit r 0. The solution is 1 pts
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