You are building a new house, which will require a construction loan of $250,000. The construction loan will be for the two year construction period of 24 months with an 8% APR compounded monthly. They make no payments on the construction loan. After the house is completed in two years, it is converted to a conventional loan at 6% APR compounded monthly for 30 years.

a) what is the initial balance of the conventional loan?

b) what are their monthly payments on the conventional loan?

c) what is the total interest paid on both loans?