Question: Please help me on this exercise, thank you! 1. You have been living in the house you bought 10 years ago for 100,000. At that

Please help me on this exercise, thank you!

1. You have been living in the house you bought 10 years ago for 100,000. At that time, you took out a loan for 80% of the house at a fixed rate 15-year loan at an annual stated rate of 6%. You have just paid off the 120th monthly payment. Interest rates have meanwhile dropped steadily to 3% per year, and you think it is finally time to refinance the remaining balance. But there is a catch - the fee to refinance your loan is 2,000 which should be paid immediately. Should you refinance the remaining balance? How much would you save/lose if you decided to refinance?

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