Bob, a homeowner, can obtain a $350,000, 30-year, fixed-rate mortgage loan at a rate of 4.5% with zero points or at a rate of 4.4% with 1 point or a rate of 4.35% with 2 points.
a. Assume Bob plans will keep the mortgage for 30 years, which option should he choose?
b. At a minimum, how long must Bob own the house to make it worthwhile to pay the points?
Show work and round to three decimal places,