Ms$.$ Bayer comes to your bank, Bank of America $($BOA$),$ to ask for advice on a planned house purchase. Her annual salary is $$60,000.$

BOA does not charge a fee $($just assume this; it is not true in the real world$)$ on housing loans, and it allows a custom's monthly mortgage pays? $($before$-$tax$).$

For a $30-$year fixed$-$rate loan with an interest rate of $12\%,$ compounded monthly, answer the following two questions: $(1)$ how much $($the maximum amount$)$ can BOA lend to Ms$.$ Bayer? $(2)$ To finance the purchase of a house, BOA requires that the home buyer come up with a $20\%$ down payment. Assume Ms$.$ Bayer can make the $20\%$ down payment. Based on the maximum loan amount, what is the maximum price of a house Ms$.$ Bayer can buy?

$3.$ Refer to the previous problem, work out an amortization table $($similar to that on Slide $4\mathrm{.}55)$ for the $360$ periods. Briefly discuss what you observe from the results. Turn in the Excel file. Name $=$ HW $2$ CH $4$ Clinton Ford Obama.xls$.$