Question 4 a) Prepare two amortization schedules: First, for the first 6 and second, for the last 6 months of a 30-year, $500,000, fixed rate mortgage loan with a nominal interest rate of 10% p.a. assuming that the loan was taken on November 3, 2021. How are the two schedules different in terms of allocation of monthly payment over principal repayment and interest payment? (4 + 4 + 2 = 10 marks) b) A FOREX trader observes the following data: Spot rate = \100 / $ 3-month forward rate = \99/$ U.S. interest rate = 5% p.a. Japanese interest rate = 1%p.a. Using the data above, compute the arbitrage profit if the FOREX trader can borrow $1 million or its Yen equivalent to start the process