1. The Smiths are refinancing their home mortgage to a 15-year loan at 7.8% annual interest compounded monthly. Their outstanding balance on the loan is $120,000.

(a) Under their current loan, the Smiths' monthly mortgage payment is $1495. How much will the Smiths be saving in their monthly mortgage payments by refinancing?

(b) How much interest will the Smiths pay over the life of the new loan?

2. $145,500 mortgage was financed with a 30 year fixed rate at 7.5%.

a) What is the monthly payment?

(Simplify your answer. Round to the nearest cent as needed.)