For the case Time Value of Money: The Buy versus Rent Decision $($Ivey Case: $9$B$14$N$024)$ please

answer the following questions and explain your reasoning where appropriate:

$1.$ Determine the required monthly payments for the mortgage.

$2.$ Determine the monthly additional payments required to buy versus rent $($i$.$e$.$ the total monthly

payments to buy less the monthly rent$).$

$3.$ Determine the principal outstanding on the mortgage after:

a$.$ Two years

b$.$ Five years

c$.$ Ten years

$4.$ Determine the Net Present Value $($NPV$)$ after two, five and ten years under the following

scenarios, which Rebecca Young has determined are possible after some $$due diligence$$ regarding

future real$-$estate prices in the Toronto condo market:

a$.$ The condo price remains unchanged.

b$.$ The condo price drops $10$ per cent over the next two years, then increases back to its

purchase price by the end of five years, then increases by a total of $10$ per cent from the

original purchase price by the end of ten years.

c$.$ The condo price increases annually by the annual rate of inflation of $2$ per cent per year

over the next ten years.

d$.$ The condo price increases annually by an annual rate of $5$ per cent per year over the next

ten years.

$5.$ As Rebecca Young, what decision would you make? Describe any qualitative considerations

that could factor into your decision.