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You have a $400,000 mortgage at 10% with BILK Bank. In addition you have entered into an arrangement to lower the interest rate if you

You have a $400,000 mortgage at 10% with BILK Bank. In addition you have entered into an arrangement to lower the interest rate if you forgo the interest payments made on your deposits. The bank, naturally, pays 5% on deposits, however under the arrangement the interest you would have received is offset against your mortgage. How much interest, if any, will be assessable to you and why?


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