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satela [25.4K]
2 years ago
10

Using the 20/10 rule, calculate the maximum amount to borrow if your net yearly income is $75,000

Business
1 answer:
Delvig [45]2 years ago
3 0
Using the 20/10 rule: you should never borrow more than 20% of your annual net income and monthly payments shouldn't be more than 10% of your monthly net income.

In this situation, we know the yearly net income is $75,000.
First we want to multiply 20% by $75,000  = $15,000 
$15,000 is 20% of your yearly net income.
This would be the most you'd want to borrow given the information provided. 
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