You are looking to finance your home. The bank is offering a three-year ARM (adjustable-rate mortgage) with an introductory rate of 3.30%. It has a 2.50% adjustment cap per adjustment period, a lifetime adjustment of 7.00%. The rate is 5.00% over the one-year LIBOR rate, which is currently 1.20%.

a. What will your interest rate be after three years if the LIBOR rate does not change? (Round your answer to 2 decimal places.) Interest rate %

b. In three years, what it the maximum interest rate you could be charged? (Round your answer to 2 decimal places.) Interest rate %

c-1. If the LIBOR increases 1.25% per year for the next 10 years, up to 13.70%, what is the maximum interest rate you will pay? (Round your answer to 2 decimal places.) Maximum interest rate % c-2. When will that maximum interest rate take effect?