3. Five years ago the Jones purchased a $420,000 home in New Westminster. They made a down payment of exactly 25% and mortgaged the balance with New Westminster Credit Union. The interest rate was 4.85% compounded semi-annually, for a five-year term, amortized over 25 years. (a) Calculate the size of the monthly payment required. The credit union rounds the payment up to the next dollar. (5 marks) ANSWER: (b) How much interest did the Jones pay in the third year of the mortgage? [3] ANSWER: (c) The Jones, after having made 5 years of payments, made a lump-sum payment to reduce the outstanding balance to $250,000. What was the size of the lump- sum payment? (3) ANSWER: (d) After making their lump sum payment, the Jones renew their mortgage for a further 5-year term at an interest rate of 6% compounded semi-annually, over a reduced amortization period of 12 years. Calculate the new monthly payment. Round the payment up to the next dollar. (4 marks] ANSWER: (e) Assuming the interest rate remains the same over the remaining 12 years, what is the size of the final payment? [4 marks]