Interest for the initial four-year term of a $122,000 mortgage is 4.11% compounded semi-annually. The mortgage is to be repaid by equal monthly payments over 20 years. The mortgage contract permits lump-sum payments at each anniversary date up to 10% of the original principal.

(a) What is the balance at the end of the four-year term if a lump-sum payment of $5,500 is made at the end of the third year?

(b) How many more payments will be required after the four-year term if there is no change in the interest rate?

(c) What is the difference in the cost of the mortgage if no lump-sum payment is made?