The ABC Bank developed a special scheme to help its customers accelerate the payment of their mortgage. Instead of making payments of R dollars once a month, mortgage borrowers are asked to pay R/2 dollars bi-weekly. A couple are buying a house and need a $750, 000 mortgage. If interest is charged at 6%/year compounded semi-annually, determine

(a) the monthly payment R required to amortize the debt over 25 years;

(b) the bi-weekly payment R/2 suggested in the scheme;

(c) the interest saved using the suggested scheme.

Hint: Use the Section 7.1 Amortization Schedule for Example 2 Excel spreadsheet available under Lecture Files on eClass. Obviously, you will need to make appropriate modifications to that spreadsheet. Please turn in a printout of your worksheet as part of your project.