Pretend that we need to borrow $350,000 for a home so we take out a loan for this amount using a 30 -year fixed rate of 7\% APR compounded monthly. Now consider the following strategy (this is actually what I did... until I refinanced, but I still pay extra every month like I describe below). Pretend that we pay: - Pretend that we pay an EXTRA $50 a month for the first year of the mortgage (that is we pay an extra $50 in addition to the minimum regular monthly payment for the 30-year loan the bank requires of us. For example, if our minimum regular payment is $500, we would pay $550 every month. Btw $500 is NOT our minimum regular monthly payment. This is just an example but some students use $500 and get the wrong answer so don't be like those students) - Then pretend that we pay an EXTRA \$150 a month for the second year of the mortgage (For example, if our minimum regular payment is $500, we would pay $650 every month) - Then pretend that we pay an EXTRA $350 a month for the third year of the mortgage (For example, if our minimum regular payment is $500, we would pay $850 every month) - And finally pretend that we then pay an EXTRA $500 a month for the fourth year of the mortgage and beyond until the loan is paid off. (For example, if our minimum regular payment is $500, we would pay $1000 every month) a. How long does it take to pay off the loan using the creative strategy? b. How much sooner do you pay off the loan than a normal 30-year loan repayment strategy? c. Find the total amount of interest paid using the creative repayment strategy