Your friend John asks you for advice concerning life insurance. John is 28 years old graduated from law school....

Your friend John asks you for advice concerning life insurance. John is 28 years old and graduated from law school last year. He currently earns S48,000 per year. John must begin paying back his student loan this month. His monthly payment will be S400 per month for the next five years at an interest rate of 5% per year. John is married and has one child, Billy, age 3. John's wife, Mary, is a professor who currently earns S5S,000 per year. Mary is 32 years old. John and Mary pay Sl ,200 per month for their home mortgage, which will be paid offin 25 years. The interest rate on their mortgage is 6.5%. (Their current equity in the home is The couple owns two cars, both 10 years old, and personal property (such as clothes, electronics, furniture, etc.) valued at S4S,000. Their investments include checking, savings, and mutual fund accounts equal to S25,000. John has no life insurance. Mary has of life insurance provided by her employer. Mary's pension plus social security are expected to total S25,000 per year, beginning when she is 65 years old. If John should die, Mary would receive approximately SIO,OOO per year from social security until Billy reaches age 18. John, Mary, and Billy live comfortably on their current family income. As a matter of fact, the family has been saving about S400 per month. However, this amount is expected to now be required to make John's school loan payment. Their investments eam approximately 5% per year. Given that John and Mary both enjoy flexible work schedules, they are able to raise Billy without the help ofa babysitter or nanny. John picks up Billy from school on Tuesdays and Thursdays and Mary picks him up on Mondays, Wednesdays and Fridays. John is worried about what mayhappen to his family is he should die. He is considering the purchase of life insurance and asks your advice. a. Assuming neither John nor Mary will receive large inheritances, how much life insurance do you think John needs? Calculate the amount using thc needs approach. Show all calculations and explain your answer. Make any assumptions you believe are reasonable, and make sure your assumptions are clearly stated. Also indicate the type of insurance you would recommend, whole life or term. If you recommend tenn, specify the length of the term policy.