a) Suppose you had to choose between a 9% 25-year mortgage or a 8.5% mortgage with 2 discount points. Assume you wished to borrow $200,000. How long should you wait before prepaying the loan, if you avail the discount points? b) The manager for Tyler Bank and Trust has the following assets to manage: Duration Duration Asset Value (in years) Liability Value (in years) Bonds 75,000,000 9.00 Demand Deposits 300,000,000 1.00 Consumer Loans 875,000,000 2.00 Saving Accounts 1,347,000,000 0.50 Commercial Loans 700,000,000 5.00 Compute the duration gap. c) Will you use junk bonds in your portfolio? Why? Why not? Make your case briefly with suitable arguments. (50 words)