Zoe Banks, age $34,$ is single and works as an engineer where she earns $$110,000$ per

year. While she has a very good income she is struggling to make ends meet because

of the debt she has accumulated. She moved to Toronto almost five years ago and

bought a condo, close to work. After her move she spent a lot of time and money on

her active social life and entertainment while enjoying the city. Over the last year she

has realized that she has accumulated a lot of debt and she needs to get her

spending under control and her financial health on track. She shares with you the

following information about her debts:

In addition to Dawn's debts, she is spending $$300$ more per month than she makes.

She asks you about consolidating her debt so that it is easier to manage.

a$)$ How much would Dawn save each year if she consolidates her non$-$mortgage debt

into an installment loan at $8\mathrm{.}0\%$ for $5-$years? $(4$ marks$)$

b$)$ Does Dawn have enough equity in her condo to consolidate her debt into her

mortgage? Explain $(1$ mark$)$

c$)$ How much would Dawn save each year if she consolidates her debt into her

mortgage at renewal and maintains her current amortization. Assume that she will

renew her mortgage for a $5-$year fixed rate at $4\mathrm{.}0\%.(3$ marks$)$

d$)$ Which option would you recommend for Dawn? Why? $(4$ marks$)$