Samuel is preparing to negotiate a home loan to be repaid monthly. He wants to borrow $257000 for 25 years. He has identified 2 possible loans to choose from: - Loan 1 has an interest rate of 6.98%p.a. compounded monthly. There are no other fees or charges. - Loan 2 has an interest rate of 6.85%p.a. compounded monthly. There is a monthly account keeping fee of $11 and a set up fee of $300. a. Calculate the comparison rate for each loan option.

a. Loan 1 comparison rate = Answer (2 decimal places) Loan 2 comparison rate = Answer % (2 decimal places)

b. Hence, Samuel should choose (Loan 1 or Loan 2)