Question 1 (4 marks) Lily bought her home 15-years ago for $500,000 (Melbourne's 2008 median). Over that 15-years she had paid off $300,000, leaving her with a loan balance of $200,000. Since 2008, Melbourne's home prices have spiked in value, and after attending an auction in the neighbourhood Lily has realized that her home is now worth $1,400,000. Required: a) Please calculate Lily's home equity (in $) given the current market value of a similar home is $1,400,000. (1 mark) b) Lily is currently paying the home and contents insurance for $350,000 based on the cover taken in 2008. Explain the concept of under insurance to Lily and identify two implications of not revising the cover