Frank and Fanny, a married couple with no children, like to hike along the trails in Hillside Country Park located behind their sub-urban home during the weekends. The monthly salary of Frank and Fanny are $43,000 and $47,000 respectively. The balance of their mortgage loan is $4,805,000 and the loan balances for their two cars are $502,000. They have bought both term life insurance and health insurance. Fanny was injured when she was riding bicycle in the Chabot Park Bike Lane two months ago. She needed to stay in the hospital for an intermediate operation. The following expenses were incurred for her medical treatment: a) $820 per day for 14 days of hospitalisation b) $180 per day for spending on meals in the hospital for 14 days c) $28,000 attending doctor's visit fee (14 visits on 12 days) d) $3,400 inpatient specialist's fec e) $32,000 surgeon's fee f) $3,800 anaesthetist's fee g) $600 each physiotherapy per week for 6 weeks h) $4,200 operating theatre fee i) $5,250 advanced diagnostic imaging j) $2,300 hospital laboratory services k) $1,250 per outpatient visit after hospitalisation for 3 times A summary of benefits coverage provided by Fanny's health insurance plan is stated in the table below: Note 1:The pereentage here applies to the Surgeon's fee actually payable or the benefit limit for the surgeon's fee according to the surgical categorization, whichever is lower. 3 Rosemary, single and age 28, plans to purchase a residential flat as her new residence for self-use. She has a stable full-time job with a monthly gross income of $45,000. Currently, she is required to make a monthly payment of $3,800 for her car loan for the next 4 years. After considering the asset values of her deposits and investments, Rosemary could afford to pay $2.4 million as down payment. The mortgage plan provided by Kenon Bank is H+1.2%, cap at P1.38%, repayable in 30 years. The current one-month HIBOR and Prime rate are 2.58% and 5.13%, respectively. The latest countercyclical measures for all self-use residential properties are: - The maximum loan-to-value (LTV) ratio is 80% - The maximum debt-servicing ratio (DSR) is 40%, and its corresponding stressed-DSR is 50% (assuming an increase of the mortgage rate by 250 basis points) REQUIRED a) Determine the mortgage rate offered by Kenon Bank. Shows your workings. (4 marks) b) Based on your answer in part (a) and the mortgage plan provided by the bank, calculate the maximum loan amounts that Rosemary can borrow under the LTV ratio, the DSR and the stressed-DSR requirements separately. Shows your workings. (8 marks) c) Based on your answer in part (b), what is the maximum loan amount that Rosemary can borrow which can satisfy the LTV ratio, the DSR and the stressed-DSR requirements? (2 marks) d) Based on your answer in part (c), calculate the maximum price (appraisal value) of the property that Rosemary can afford. What is the monthly payment of the loan she must pay? Show your workings. (6 marks)