Suppose you have an outstanding mortgage of 350,000 on a house you paid 450,000 for. You have 20 years remaining on your mortgage which is payable and compounded monthly and has a rate of 4% APR. What is your current monthly payment? [For simplicity assume that interest is compounded monthly and not semi-annually as normally required by Canadian law]

A) $700

B) $1458.33

C) $1566.66

D) $2120.93

E) $14,001.14

3. Continue with the information provided in question 2. Assume mortgage rates jump to 6% two years from now and assume you sell your house to someone with the exact same down-payment and income you had when you bought the house. What annual rate of return could you expect to earn on your down-payment (ROE)?

A) -53.9%

B) -16.42%

C) -11.99%

D) -6.18%

E) Cannot be computed with the information provided