Question: Kit and Jo are considering two possible alternatives sell their home and buy a larger house for AUD4.0 million, or, keep their home and build

Kit and Jo are considering two possible alternatives sell their home and buy a larger house for AUD4.0 million, or, keep their home and build a major extension for AUD1.5 million. Funding for either alternative will involve increasing their existing home loan ($1.2 million). Their net income after tax and super is $270000 combined. Assess and compare the financial viability of these two alternatives (assume the bank loan is interest only with an interest rate of 5.0% per annum)

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