The following table shows the assets and liabilities of the chang family in 2007 and 2008. 2007 2008 home valued at $315,000 home valued at $325,000 mortgage of $265,000 mortgage of $240,000 car valued at $10,000 car valued at $6,000 car loan of $5,000 car loan of $1,000 savings of $2,000 credit card debt of $1,500 based on the table, which of the following is true? a. from 2007 to 2008, both assets and liabilities decreased. b. from 2007 to 2008, both assets and liabilities increased. c. from 2007 to 2008, assets decreased and liabilities increased. d. from 2007 to 2008, assets increased and liabilities decreased.

The correct answer is:

d. From 2007 to 2008, assets increased and liabilities decreased.

Explanation:

The value of the house increased by 10,000, from $315,000 to $325,000.  This is an asset.

The amount of the mortgage decreased by 25,000, from $265,000 to $240,000.  This is a liability.

The value of the car decreased by 4,000, from $10,000 to $6,000.  This is an asset.

The amount of the car loan decreased by 4,000, from $5,000 to $1,000.  This is a liability.

The savings were depleted, all $2000 gone.  This was an asset.

New credit card debt is opened, for $1,500.  This is a liability.

This means the assets had the following changes:

+10,000 - 4000 - 2000 = 6000 - 2000 = 4000

This is a positive integer, which indicates the assets increased.

The liabilities had the following changes:

-25000 - 4000 + 1500 = -29000 + 1500 = -27500

This is a negative integer, which indicates the liabilities decreased.

Correct answer is D

Step-by-step explanation:

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