The following is a question related to mortgage:

A variable rate mortgage that has a principal of $100,000 and a term of 30 years has an initial interest rate of 8%. That rate is guaranteed for 5 years, and will then be adjusted depending upon prevailing rates at that time. The new rate can be applied to the loan either by changing the payment for the remaining time, or by keeping the payment fixed and adjusting the length of the mortgage. (a) What is the original yearly mortgage payment assuming annual payments and compounding. [2] (b) What will be the mortgage balance after 5 years? [2] c) If the new interest rate is then 9%, what will be the new yearly payment for the same termination time of the mortgage? [3] (d) Or, what will be the new term of the mortgage if the payments remain the same? [3]