According to the standard debt-to-income ratio, the person who would be rated as highest in respect of eligibility for a home loan is person C.
<h3>What is a home loan?</h3>
A home loan is an amount that has been lent for the acquisition or purchase of any house. or apartment for living.
Given values:
<u>Persons </u> <u> Monthly Incomes </u> <u> Recurring debts </u>
Person A $4,250 ($51,000 / 12) $350
Person B $4,833 ($58,000 / 12) $250
Person C $5,250 ($63,000 / 12) $200
Person D $5,583 ($67,000 / 12) $450
<u>Step-1 </u> Computation of debt-to-income ratio of person A:
![\rm\ Debt \rm\ to \rm\ Income \rm\ ratio=\frac{\rm\ Recurring \rm\ debt}{\rm\ Income}\\ \rm\ Debt \rm\ to \rm\ Income \rm\ ratio=\frac{\$350}{\$4,250}\\\rm\ Debt \rm\ to \rm\ Income \rm\ ratio=8.23\%](https://tex.z-dn.net/?f=%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D%5Cfrac%7B%5Crm%5C%20Recurring%20%5Crm%5C%20debt%7D%7B%5Crm%5C%20Income%7D%5C%5C%20%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D%5Cfrac%7B%5C%24350%7D%7B%5C%244%2C250%7D%5C%5C%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D8.23%5C%25)
<u>Step-2 </u>Computation of debt-to-income ratio of person B:
![\rm\ Debt \rm\ to \rm\ Income \rm\ ratio=\frac{\rm\ Recurring \rm\ debt}{\rm\ Income}\\ \rm\ Debt \rm\ to \rm\ Income \rm\ ratio=\frac{\$250}{\$4,833}\\\rm\ Debt \rm\ to \rm\ Income \rm\ ratio=5.18\%](https://tex.z-dn.net/?f=%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D%5Cfrac%7B%5Crm%5C%20Recurring%20%5Crm%5C%20debt%7D%7B%5Crm%5C%20Income%7D%5C%5C%20%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D%5Cfrac%7B%5C%24250%7D%7B%5C%244%2C833%7D%5C%5C%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D5.18%5C%25)
<u>Step-3 </u>Computation of debt-to-income ratio of person C:
![\rm\ Debt \rm\ to \rm\ Income \rm\ ratio=\frac{\rm\ Recurring \rm\ debt}{\rm\ Income}\\ \rm\ Debt \rm\ to \rm\ Income \rm\ ratio=\frac{\$200}{\$5,250}\\\rm\ Debt \rm\ to \rm\ Income \rm\ ratio=3.80\%](https://tex.z-dn.net/?f=%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D%5Cfrac%7B%5Crm%5C%20Recurring%20%5Crm%5C%20debt%7D%7B%5Crm%5C%20Income%7D%5C%5C%20%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D%5Cfrac%7B%5C%24200%7D%7B%5C%245%2C250%7D%5C%5C%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D3.80%5C%25)
<u>Step-4 </u>Computation of debt-to-income ratio of person D:
![\rm\ Debt \rm\ to \rm\ Income \rm\ ratio=\frac{\rm\ Recurring \rm\ debt}{\rm\ Income}\\ \rm\ Debt \rm\ to \rm\ Income \rm\ ratio=\frac{\$450}{\$5,583}\\\rm\ Debt \rm\ to \rm\ Income \rm\ ratio=8.06\%](https://tex.z-dn.net/?f=%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D%5Cfrac%7B%5Crm%5C%20Recurring%20%5Crm%5C%20debt%7D%7B%5Crm%5C%20Income%7D%5C%5C%20%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D%5Cfrac%7B%5C%24450%7D%7B%5C%245%2C583%7D%5C%5C%5Crm%5C%20Debt%20%5Crm%5C%20to%20%5Crm%5C%20Income%20%5Crm%5C%20ratio%3D8.06%5C%25)
Therefore, after finding debt to income ratios of all persons, the lowest ratio comes out to be of Person C at 3.80% which ranked to be the highest.
Learn more about the debt ratio in the related link:
brainly.com/question/14553933
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