Using the 28/36 ratio, determine the maximum allowable recurring debt for someone with an annual income of $86,250.
a.
$575.00
b.
$2,012.50
c.
$2,415.00
d.
$2,587.50

Option A.

Step-by-step explanation:

Annual income = $86,250

Monthly income =

According to the 28/36 rule:

1. A household should spend no more than 28% of its gross monthly income on total housing expenses.

2. No more than 36% on all debt, including housing-related expenses and other recurring debt service.

36% - 28% = 8%

It means maximum allowable recurring debt is 8% of monthly income.

Maximum allowable recurring debt =

                                                           = $575

Therefore, the correct option is A.

d. 8

step-by-step explanation:

the given radical expression is:

we can rewrite this as:

we express as square numbers to get;

the exponents will now cancel out to give.

the correct answer is d

graph b

step-by-step explanation:

one solution- graph a (clear intercepting point.)

no solution- graph b (they're parallel, there will never be a point of interception.)

infinite solutions- graph c (all points intercept.)