You are 20 years old and plan to purchase a house when you are 35

.a. The current price of the house you want to purchase is $275,000 and the price is expected to increase by 3% per year. How much will the house cost when you are 35?

b. When you are 35, the bank will require a cash down-payment of 10% of the house price to obtain a mortgage. How much will you need to save each year between age 20 and 35 to have enough for the down-payment, if you can earn 5% on your deposits? Assume end-of-year deposits.

c. Given the same data in part b., how much will you need to deposit each year to have enough for the down-payment if you make beginning-of-year deposits?

d. Suppose your parents promise to pay the down-payment when you turn 35. How much will they need to deposit today in an account that will earn 8% for the next 15 years (when you will need to the down-payment)?