A full life care CCRC contract is priced using the following model. ILU O ALU 1 SNF 2 Dead 3 You are given: The resident has to pay an entry fee of $200,000 upon issuance of the contract. The resident also has to pay a fee at the beginning of each month. The monthly fees will remain level regardless of whether the resident is in the ILU, ALU, or SNF. The monthly costs incurred by the CCRC are as follows: Resident Category Monthly Costs Independent Living Unit 2,500 Assisted Living Unit 6,000 Skilled Nursing Facility 10,000 . i= 5% Using an annual effective interest rate of 5%: o 70 10.0554 (12)00 (12)01 (12) 02 O 0.74720 o 070 0.30944 = 0.45894 70 The contract is issued to Molly, age 70, who will be moving into the Independent Living Unit. Calculate the level monthly fees that Molly has to pay assuming 70% of the entry fee is refunded at the end of the month of death. 1,886 B 1,906 1,926 D 1,946 E 1,966 A full life care CCRC contract is priced using the following model. ILU O ALU 1 SNF 2 Dead 3 You are given: The resident has to pay an entry fee of $200,000 upon issuance of the contract. The resident also has to pay a fee at the beginning of each month. The monthly fees will remain level regardless of whether the resident is in the ILU, ALU, or SNF. The monthly costs incurred by the CCRC are as follows: Resident Category Monthly Costs Independent Living Unit 2,500 Assisted Living Unit 6,000 Skilled Nursing Facility 10,000 . i= 5% Using an annual effective interest rate of 5%: o 70 10.0554 (12)00 (12)01 (12) 02 O 0.74720 o 070 0.30944 = 0.45894 70 The contract is issued to Molly, age 70, who will be moving into the Independent Living Unit. Calculate the level monthly fees that Molly has to pay assuming 70% of the entry fee is refunded at the end of the month of death. 1,886 B 1,906 1,926 D 1,946 E 1,966