Suppose you buy a fridge for $1120. You agree to pay off the total amount with monthly payments over 4 years at j12 = 11%. If you wish to refinance you will have to pay a penalty equal to 2 months' interest on the outstanding balance. After 12 payments you see that interest rates at your bank are j12 = 6.5%. (a) Calculate the original monthly payment. Answer: $ (b) Calculate the new monthly payment if you were to refinance under your banks interest rate. (Assume the original term does not change.) Answer: $ (c) Should you refinance? Answer: ? yes no NOTE: When calculating a payment or outstanding balance, round appropriately and carry that value through further calculations.