6) Suppose you purchase a new home for 150,000 USD making a down payment of 30% and taking out a mortgage on the balance.

a) What is the return on your investment in the new home if one year later, the price of the home increases by 20%?

b) What is the return on your investment in the new home if one year later, the price of the home decreases by 20%?

c) How would you answers to a) and b) above change if your down payment was only 15%? Show your results.

d) Explain why the return on investment changes as the size of the down payment changes.