Question

Jordan has the following assets and liabilities:_______. Two cars $10,000 House $200,000 Mortgage $100,000 Cash $1,000 Car loans $3,000 Checking account balance $2,000 Credit card balance $1,000 What is Jordan’s wealth?a. $107,000
b. $213,000
c. $109,000
d. $111,000

Answer 1

Answer:

c $109,000

Explanation:

A person's wealth is calculated by deducting their liabilities from their assets. The value left after the deduction is the person's wealth. In the above case, Jordan's wealth is calculated as;

= Assets [ Two cars + House + Cash balance + Checking account balance ] - Liabilities[ Mortgage - Car loans - Credit card balance ]

= [ $10,000 + $200,000 + $1,000 + $2,000 ] - [$100,000 + $3,000 + $1,000]

= $213,000 - $104,000

= $109,000

Therefore, Jordan's wealth is $109,000