Final answer:
The Mathematics question involves calculating a new mortgage payment on a $200,000 cottage after renewal of the mortgage terms, taking into account the initial down payment, original interest rate, and new interest rate upon renewal.
Step-by-step explanation:
The subject of this question is Mathematics as it involves calculating the size of new monthly payments on a mortgage. When a cottage can be purchased for $200,000 with a 25% down payment, the balance to be financed is $150,000. For the initial period of 5 years, the mortgage has an interest rate of 2.15% compounded semi-annually. To find the monthly payment for this period, we would have to use the present value of an annuity formula appropriate for a mortgage. After the 5-year term, the mortgage is renewed at 2.45% with the same compounding frequency, but the remaining balance would be based on the amortization of the past 5 years. This involves calculating the remaining balance after 5 years and then using this as the principal amount to calculate the new monthly payment over the remaining 20 years of the original 25-year amortization period.