Natalie Warren is a single woman in her late 20 s. She is renting an apartment in the fashionable part of town for $1,400 a month. After much thought, she's seriously considering buying a condominium for $380,000. She intends to put 20 percent down and expects that closing costs will amount to another $6,500; a commercial bank has agreed to lend her money at the fixed rate of 6 percent on a 15 -year mortgage. Natalie would have to pay an annual condominium owner's insurance premium of $640 and property taxes of $1,300 a year (she's now paying renter's insurance of $550 per year). In addition, she estimates that annual maintenance expenses will be about 0.5 percent of the price of the condo (which includes a $30 monthly fee to the property owners' association). Natalie's income puts her in the 24 percent tax bracket (she does not itemize her deductions on her tax returns), and she earns an after-tax rate of return on her investments of around 4 percent. Assume that the standard deduction for a single person is $12,000. Given the information provided, use Worksheet 5.2 to evaluate and compare Natalie's alternatives of remaining in the apartment or purchasing the condo. (Note: Assume Natalie does not have any security deposit.) Round your answers to the nearest cent. 1. Annual ownership cost: $ 2. Annual rental cost: $ 3. Working with a friend who is a realtor, Natalie has learned that condos like the one she's thinking of buying are appreciatin in value at the rate of 3.5 percent a year and are expected to continue doing so. Would such information affect the rent-or: buy decision made in Question 1? 4. Which would you recommend for Natalie in light of your analysis? heNT-OR-aurANACrys A. costor ntwTine 1. Amual rental caita 5 2. Nenterinsurace a. Opportunity cost of securty deoout: 5 Naher Gaxivinas ate Total rest of incting fine A. 1+ line A.2 + line A.3 n. cosr or numsa 1. Anfual martente purmens (Teme: is monthis, \$) if 12 . montew mocteace paymet of \begin{tabular}{l} 1 \\ \hline 3= \end{tabular} i 2. Froperty unes f. sof profe of homel 3. Homeowera inturace i. Not proe ot home) 4. Monterance i. sof price of homet is Aher uricost el interit on shan parment and dosine cost is 5 , 6. Tositose fum of ines a.1 thoush B.s) 7. Mrnopal reduction in toan bulance bies note below) 4. Tarsavincidue to interest deductions* interest portion of mortage parments 3 . xtasrote of (6) 9 Tariavines due fo property ux deductions" Ane 8.2 tax rate of Ni 10. Tocal deductions (sum of linet B., through Bis) 11. Annualafter tax cost of home ownershe 12. Citimated arrual appecoation in value of home i Wof price of home) Total cost of byine (ine B 11 - fine a. 22 ) "Tax-sheliteritems