A borrower can obtain an $80$ percent loan with an $8$ percent interest rate and monthly payments.

The loan is to be fully amortized over $25$ years. Alternatively, he could obtain a $90$ percent loan

at an $8\mathrm{.}5$ percent rate with the same loan term. The borrower plans to own the property for the

entire loan term.

a$.$ What is the incremental cost of borrowing the additional funds? $($Hint: The dollar amount of

the loan does not affect the answer.$)$

b$.$ How would your answer change if $2$ points were charged on the $90$ percent loan?

c$.$ Would your answer to part $($b$)$ change if the borrower planned to own the property for only

five years?