Ann got a 30 year FRM with annual payments equal to $24000. After 2 years of payments, Ann will refinance the balance into a 28 year FRM with annual payments equal to $20000. Refinancing will cost Ann $5500. Ann will prepay the new loan 3 years after refinancing. She will save $2500 on her loan balance when she prepays.

Use all the information given, write the NPV formula for Ann's refinancing decision if her annual discount rate is i. Plug in all the numbers you can, Only plug-in one final net cash-flow for each time period.