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Habib Bank makes a loan of $5000000 for a term of 21 years at an interest rate of 5.75% compounded 2 times per year. The

Habib Bank makes a loan of $5000000 for a term of 21 years at an interest rate of 5.75% compounded 2 times per year. The loan will be repaid with level payments at the end of each month.

a) What are the level payments?

b) If Habib Bank does not re-invest the loan payments, how much money will they have at the end of 21 years?

c) If Habib Bank re-invests the loan payments each month in an account earning 3.35% (compounded 2 times per year), how much money will they have?

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