Suppose you want to borrow $220,000 to purchase a house. two banks, wells fargo and bank of america, are willing to lend you the money. both banks will amortize the loan over 30 years and the payments will be monthly. wells fargo will lend you the money at 4.5% with 0.5 points. bank of america will lend you the money at 4.25% but will charge 2 points. i. which banks should you choose if the loan is refinanced in 5 years? ii. which bank should you choose if the loan is refinanced in 20 years? iii. what is the apr on the bank of america loan if the loan is refinanced in 20 years.

Make or buy eastside company incurs a total cost of $120,000 in producing 10,000 units of a component needed in the assembly of its major product. the component can be purchased from an outside supplier for $11 per unit. a related cost study indicates that the total cost of the component includes fixed costs equal to 50% of the variable costs involved. a. should eastside buy the component if it cannot otherwise use the released capacity? present your answer in the form of differential analysis. use negative sign represent a net disadvantage answer; otherwise do not use negative signs with your answers. cost from outside supplier $answer variable costs avoided by purchasing answer net advantage (disadvantage) to purchase alternative $answer b. what would be your answer to requirement (a) if the released capacity could be used in a project that would generate $50,000 of contribution margin? use negative sign represent a net disadvantage answer; otherwise do not use negative signs with your answers.