A family has raised a mortgage of 150,000 EUR on its house. It can amortize the balance at 8.5 per cent p.a. for ten years.

(a) What are the annual payments? What is the total payment? Give a complete redemption table with the current amount of the loan at the beginning and at the end of each year, interest payment and amortization instalment for all the 10 years.

(b) Find the total payment if the family repays 15,000 EUR plus the interest on the current amount of the loan every year (equal amortization instalments).

(c) How many years does the family repay when the annual annuity is A = 18, 000 EUR?