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3. (30 points) Mr. Smith wants to Install in Barcelona area and two alternatives are offered by the owner of the property where he wants to live: Option A: Renting an apartment with a perpetual contract, meaning for ever and ever. In this case, Mr. Smith has to pay 3.500 per month and the contract contains a clause stating that the rent price will be growing at a 0.12% monthly Option B: Acquiring the apartment with a mortgage scheme for 40 years. The current ownership is demanding an initial payment of 400,000 and a monthly amount of 1,000 C. The Interest applicable rates are around 4% compounded yearly, this is supposed to be the market rate for this type of activities. a. In terms of Finance, what is the difference between Option A and Option B? (10 points) b. What is the total amount that Mr. Smith should pay in Option A? (30 points) What is the total amount that Mr. Smith should pay in Option B? (30 points)