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SpyIntel [72]
3 years ago
8

Advice from most financial advisers states to spend no more than 28% of one's gross monthly income for one's mortgage payment, a

nd to spend no more than 36% of one's gross monthly income for one's total monthly debt. Suppose a family has a gross annual income of $39,600. a. What is the maximum amount the family should spend each month on a mortgage payment? b. What is the maximum amount the family should spend each month for total credit obligations? c. If the family's monthly mortgage payment is 70% of the maximum they can afford, what is the maximum amount they should spend each month for all other debt?
Business
1 answer:
meriva3 years ago
7 0

Answer and Explanation:

The computation is shown below:

a. For the maximum amount that spend each month on mortgage payment is

= Gross annual income ÷ total number of months in a year × mortgage payment percentage

= $39,600 ÷ 12 months × 28%

= $924

b. . For the maximum amount that spend each month on total credit obligatons

= Gross annual income ÷ total number of months in a year × mortgage payment percentage

= $39,600 ÷ 12 months × 36%

= $1,188

c. Now the maximum amount spend for all other debt is

For monthly mortgage

= $924 × 70%

= $646.8

And, for mortgage debt

= $1,188 × 70%

= $831.60

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Identify whether each statement in the following table best illustrates the concept of consumers’ surplus, producers’ surplus, o
Blizzard [7]

Answer:

1. Neither ; 2. Consumer Surplus ; 3. Producer Surplus

Explanation:

Consumer Surplus is the difference between a good's price paid by consumer, & maximum price the consumer is willing to pay for the good.

Producer Surplus is the difference between a good's price received by a seller, & minimum price at which the seller is willing to sell the good.

1. Willing to pay $209 for watch, buyer willing to sell at $196, no trade as price ceiling at $190 : It illustrates neither concept as transaction has not actually occurred, so no price established.

2. Willing to pay $39 for sweater, purchased it for $32 : It illustrates 'Consumer Surplus' case = $7 , as it shows difference between maximum willingness to pay by buyer ($39) & the actual buy price ($32)

3. Willing to sell laptop at $190, sold it at $199 : It illustrates 'Producer Surplus' case = $9 , as it shows difference between minimum willingness to sell price ($190) &  actual sale price ($199)

5 0
3 years ago
Suppose that many people who earn a living raising cows decide they can make more money selling t-shirts and switch occupations.
zimovet [89]

Answer:

B. There will be a decrease in supply.

Explanation:

The switch would cause the amount of cow rearers to fall. The amount of cow available would fall and there would be a decrease in the supply of beef.

I hope my answer helps you

5 0
2 years ago
"a branding strategy in which a firm uses a different brand for each of its products is called ____ branding."
Aleksandr-060686 [28]
<span>A branding strategy in which a firm uses a different brand for each of its products is called individual branding. With the use of this strategy, products from the same company are given a unique identity and name. This is especially useful when companies offer a wide range of products that cater different price markets. </span>
8 0
3 years ago
An online bank is offering to pay 0.25 % interest per month on deposits. Your local bank offers to pay 0.75 % interest quarterly
Liono4ka [1.6K]

Both have the same interest rate which is 3%.

<h3>What is interest?</h3>
  • In finance and economics, interest is the payment of an amount above the repayment of the principal sum by a borrower or deposit-taking financial institution to a lender or depositor at a specific rate by a borrower or depositor.
  • It differs from a fee that the borrower may pay to the lender or a third party.

To find the higher interest rate:

Given that,

  • Interest rate per month = 0.25%
  • Interest rate per quarter = 0.75%

If we calculate the annual interest for monthly and quarterly rates, it will be:

Monthly

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  • Monthly rate = 0.25%

So,

  • Annual Interest = 0.25 × 12
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Quarterly

  • No. of quarters in a year = 4
  • Quarterly rate = 0.75%

So,

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Therefore, both have the same interest rate which is 3%.

Know more about your interests here:

brainly.com/question/2294792

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4 0
1 year ago
Is the yield to maturity on a bond the same thing as the required return? Is YTM the same thing as the coupon rate? Suppose toda
kiruha [24]

Answer:

Explanation:

The yield to maturity on a bond is the same thing as the required return. The YTM and the coupon rate is a totally different thing. The coupon rate is the interest which is computed on the principal amount whereas yield to maturity is a rate which is held at the maturity and its rate is also generated in maturity date.  

So, in the given case, the Coupon rate is 10% and the YTM is 8% as it reflects the maturity i.e two years from now

6 0
3 years ago
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