Question

Yen has a net salary of $3,722 each month. Her fixed monthly expenses consist of $500 for rent. She also makes a monthly car payment of $299, not including her monthly car insurance premium of $173. Are these payments within Yen's recommended limit?

Answer 1

Yes These payments are within Yen's recommended limit.

Answer 2

Yen's payments are within recommended limits.

Step-by-step explanation:

Considering that Yen 's debts can't be over 28% of her income, as this is a general common sense rule. Let's calculate how much her debts represent:

`\$500+\$299+\$173=\$972\Rightarrow (\$972)/(\$3722)\approx 26.11\%`

So, yes. Yen's payments are within recommended limits.