Your cousin Nick, is living in the U.S. now, and is thinking about relocating to a Mediterranean Life. Therefore, Nick plans to buy a house in the French Riviera. The house costs $350,000. Nick has $50,000 in cash that he can use as a down payment on the house, but he needs to borrow the rest of the purchase price.

The bank is offering a 30-year mortgage that requires annual payments and has an interest rate of 7% per year.

Nick can afford to pay only $23,500 per year. The bank agrees to allow him to pay this amount each year, yet still borrow $300,000. At the end of the mortgage (in 30 years), Nick must make a balloon payment; that is, Nick must repay the remaining balance on the mortgage. How much will this balloon payment be?

Consider a normal distribution with mean equal 50, and standard deviation equal to 4.

5% of the values are less than what X value?