You are looking at a car loan to finance your newly bought dream car. The car will cost you $150,000 of which you must pay 40% upfront. The car dealer quotes you an interest rate of 2% per annum for a 5-year loan, for which monthly payments are based on the following formula:

Suppose you are looking to refinance your housing loan and you only have $90,000 left to pay on the mortgage.

(i) What interest rate (per annum) should the bank quote you on the housing loan for it to be equivalent to the rate quoted by the car dealer? (2 marks)

(ii) What is the monthly amount you would have to pay in this case? (2 marks)

(iii) What is the first month principal and interest paid? What is the balance outstanding after these payments are made? (4 marks)