Financial accounting question

Can someone help me with two questions please?

QUESTION START
Alice is a 21 years old graduate from Deakin University. She just got a job at the ANZ bank as a financial analyst. Her pre-tax salary is $60,000 per annum but will increase at the rate of 6% per year for the next 4 years. After 4 years, Alice is confident that she will be promoted to the next level where her salary would be $120,000 per year and increase at the rate of 5% per year for the next 5 years. After these 5 years, Alice expects to be promoted again in which case she would earn a salary of $250,000 per year and this will increase at the rate of 5% for the next 6 years. Alice assumes that she will not be promoted again after this level and her existing salary will simply increase at the rate of inflation which is 2% per annum. Alice aims to retire when she is 65. Alice wants to buy her own home. At the moment, she is looking in an area she likes but has two choices:

Option 1: Apartment: She can buy a two-bed room apartment. The two-bedroom apartment

Option 2: House: She can buy a two-bed room house. The two-bedroom house costs $780,000 and is projected to grow at the rate of 7% per annum.

In either case, Alice will need a minimum deposit of 20% of the value of the home in order to borrow the remaining 80% to purchase the apartment/house.

Alice would still like to maintain a good lifestyle so therefore plans to use 50 percent of her after-tax salary as savings for the deposit. Once she has saved enough for the deposit, she plans to maintain this 50 percent level towards the payment for the loan.

Alive would like some advice on the following:

Question 1
Q1c. To pay off the loan quicker, Alice considers the following options:

Option 1: Alice decides to be more frugal and can try to Increase her salary contribution from 50 percent to 60 percent. If Alice takes this option how long would it take her to pay off the loan?

Option 2: When saving for a deposit, instead of putting her savings in a bank account, Alice can invest in an annuity stream which earns a rate of return of 12 percent per annum. This type of investment requires Alice to commit her savings into an investment fund for 5 years where each year she must put in $20,000. Alice cannot take the money out prior to 5 years. Recall that Alice plans to save 50 percent of her after-tax salary for the deposit, since she can only put $20,000 in the investment fund each year, the remaining money will be put into a bank account which earns 2% per annum. If Alice takes this option, how much will she able to accumulate after 5 years, how much will she have to borrow and how long before she can pay off the loan?

Option 3: Instead of living in the property, she will rent the property out. Assume that the two-bedroom apartment or house will provide the same rental return of $550 per week after tax. Alice can rent a 1 bed room apartment somewhere else to live at the cost of $250 per week. If Alice takes this option how long would it take her to pay off the loan? How much interest would she pay over the life of the loan?

Option 4: Instead of renting somewhere else to live, Alice can move back and stay with her parents and continue to rent her property out at $550 per week after tax. Each month, she only needs to contribute $600 to her parents for living expenses. With this option, Alice can put aside 70 percent of her after-tax salary towards the payments together with the rent payment that she receives from her tenant. If Alice takes this option how long would it take her to pay off the loan? How much interest would she pay over the life of the loan?

Question 2. After consider all different scenarios, please advise Alice what she should do? List the reasons. (word count: approx. 400 words)

Hints: To answer this question, please consider which property Alice should buy i.e. the value of the property when Alice reaches 65. Should she work hard to make sure that she gets the second promotion? The proportion of her tax salaries that will go into her loan repayment? Should she rent the property out?

Assumptions:
1. Please use the 2015 – 2016 tax table to calculate taxable income (You can find from week 1 lecture notes)
2. Alice gets paid her salary at the end of each month
3. Rent and interest, investment fund earning is not taxable in this scenario.
4. You can assume there are 4.25 weeks in a month.
5. The interest that Alice earns at the bank is calculated and paid yearly.
6. For simplicity, you can assume there is no stamp duty and other buying costs and ignore Medicare levy.