AnswersMathematics for Data and Financial LiteracyPractice TestQuestion 16
16
practice testMultiple Choice

Practice Test

Question 16 • Mathematics for Data and Financial Literacy

Alejandra has a gross monthly salary of $⁢4,000 and pays $⁢500 toward a car loan, $⁢200 toward a credit card, and $⁢100 toward a student loan each month. What is her debt-to-income ratio, written as a percent? Use the debt-to-income ratio formula: (total monthly debt payments)/(gross monthly income)⋅100

Answer
A
25%
B
15%
C
30 percent
D
20%

Explanation

First add Alejandra’s monthly debt payments: $500 + $200 + $100 = $800. Divide that total by her gross monthly income and multiply by 100: ($800 ÷ $4,000) × 100 = 20%. Her debt-to-income ratio is 20%, the choice labeled A.

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