trudys monthly expenses are outlined in the chart below. trudys job pays her $36,000 annually. determine trudys dti (debt-to-income) ratio.

a. 28%
b. 35%
c. 37%
d. 44%

Question

trudys monthly expenses are outlined in the chart below. trudys job pays her $36,000 annually. determine trudys dti (debt-to-income) ratio.

a. 28%
b. 35%
c. 37%
d. 44%

Accepted Answer

{ "quality": "clear", "question_count": 1, "skills_matched": [ "step_cot", "multiple_choice_formatter", "explain_then_answer", "tutor", "mastery_adaptive_brevity" ], "needs_drawing": false, "concepts_used": [ "Debt-to-Income Ratio", "Monthly Gross Income", "Table Reading" ], "new_concepts": [], "current_concepts": [ "Debt-to-Income Ratio", "Monthly Gross Income", "Table Reading" ] } ## Calculate monthly gross income Using the *Monthly Gross Income* and *Table Reading* knowledge points $$ \text{Monthly Gross Income} = \frac{\$36,000}{12} = \$3,000 $$ ## Sum monthly debt payments Using the *Table Reading* knowledge point $$ \begin{aligned} \text{Total Monthly Debt} &= \text{Rent} + \text{Car Payment} + \text{Student Loan} + \text{Credit Cards} \ &= \$695 + \$265 + \$200 + \$160 \ &= \$1,320 \end{aligned} $$ ## Calculate debt-to-income ratio Using the *Debt-to-Income Ratio* knowledge point $$ \begin{aligned} \text{DTI Ratio} &= \frac{\text{Total Monthly Debt}}{\text{Monthly Gross Income}} \times 100\% \ &= \frac{\$1,320}{\$3,000} \times 100\% \ &= 0.44 \times 100\% \ &= 44\% \end{aligned} $$

a. 28%

b. 35%

c. 37%

d. 44%

{ "subject": "Business", "question_type": "Multiple Choice", "knowledge_point": [ "Business", "Finance", "Debt-to-Income Ratio" ] }

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QUESTION IMAGE

Question

Explanation:

Calculate monthly gross income

Sum monthly debt payments

Calculate debt-to-income ratio

Answer: