(Annuity payments) Mr. Bill S. Preston, Esq., purchased a new house for

$140,000.

He paid

$15,000

upfront and agreed to pay the rest over the next

20

years in

20

equal annual payments that include principal payments plus

9

percent compound interest on the unpaid balance. What will these equal payments be?

a.Mr. Bill S. Preston, Esq., purchased a new house for

$140,000

and paid

$15,000

upfront. How much does he need to borrow to purchase the house?

$125,000

(Round to the nearest dollar.)

b.If Bill agrees to pay the loan over the next 20 years in 20 equal end-of-year payments plus 9 percent compound interest on the unpaid balance, what will these equal payments be? (Round to the nearest cent.)