Question: Consider a $2 million, 8% CPM with monthly payments. What is the regular monthly payment and the balloon payment amounts in each of the following cases?
a. Fully amortizing, 25-year loan
b. 25-year amortization, 10-year balloon
c. 15-year amortization, 10-year balloon
d. What are the major disadvantage and advantage of the 15-year amortization-rate 10-year loan in part (c) as compared to the 25-year amortization-rate 10-year loan in part (b)?