Lawrence is buying a house for N$ 750 000. He has to pay a 12% deposit and can secure a bond from his bank repayable over 20 years at 12% p.a. interest.

(a) What is his monthly installment? (3)

(b) Another bank is now giving him two better options i.e. to increase the payback period to 28 years or to reduce the rate by 1% p.a. Find the monthly installment for each option.

(i) 28 year payback period (3)

(ii) Reduced interest rate (3) (

c) How much money will he save per month using the cheapest option? (2)