# Mat126 Survey of Mathematics - Budget

by Angel
(VA)

Select the first three letters of your last name. Each letter has a numerical place value in the alphabet. For example, D is 4, L is 12, and Z is 26. Add the three place values together.

The first three letters of my last name is MAR

Multiply your sum by 1500. This is your yearly income for Week Four Discussion 1.
Please use the following monthly expenses: Car payment = \$283.15, Car insurance = \$72, Utilities (includes water and power) = \$242.77, Internet = \$32, and Cell Phone = \$79.95.
You also have a yearly educational bill of \$7980 which includes textbooks and classes.
What percent of your monthly income is the car payment?
Subtract the sum of your monthly expenses. Use this value to calculate what percent of your income is now available to spend for food, clothing, and your rent or mortgage.
Use the plan at the bottom of page 538, “Mathematics in Our World Revisited,” to calculate the monthly mortgage payment established by your monthly income.
Assume you can afford a down payment equal to 25% of your yearly income. What is the total purchase price can you afford for a home? Would this amount allow you to purchase a home in the area where you live?

### Comments for Mat126 Survey of Mathematics - Budget

 Feb 02, 2012 Calculate Affordable Home Value by: Staff ------------------------------------------------------- Part II Subtract the sum of your monthly expenses. \$4,000 per month, monthly income -\$283.15 per month, Car payment -\$72 per month, Car insurance -\$242.77 per month, Utilities (includes water and power) -\$32 per month, Internet -\$79.95 per month, Cell Phone -------------------------------------- \$3,290.13 per month (monthly income after monthly expenses, without educational expenses) If educational expenses are included: \$3,290.13 per month -\$665 per month, educational expenses -------------------------------------- \$2,625.13 per month (monthly income after monthly expenses, including educational expenses) --------- Calculate what percent of your income is now available to spend for food, clothing, and your rent or mortgage. [(Monthly income after payments)/(Monthly income)] * 100 = % available Without including educational expenses (\$3,290.13 /\$4,000)*100 = 82.2532% Available income is 82.3% of the monthly income. Including educational expenses (\$2,625.13 /\$4,000)*100 = 65.6283% Available income is 65.6% of the monthly income. Assume you can afford a down payment equal to 25% of your yearly income. \$48,000 * .25 = \$12,000 down payment What is the total purchase price you can you afford for a home? Mathematics in Our World Revisited How Much Can You Afford to Pay for a Home? ▲ Experts suggest that a person can afford to pay 28% of his or her gross monthly income for a home mortgage. Given this assumption and using Table 9-1 on page 435, you can ﬁgure out how much you can afford to pay for a home, as shown. 28% of gross monthly income = .28*\$4,000 = \$1,120 You can afford a monthly mortgage payment of \$1,120.00. Now to see what you can afford to borrow, look up the number corresponding to 7% and 25 years in Table 9-1 on page 435. It is 7.70. Set up an equation and solve for x. 7.70x = \$1,120 X = \$1,120/7.70 = 145.455 You can afford a mortgage of 145.455*1000 = \$145,455 You can afford a mortgage of \$145,455 Finally, add your down payment of \$12,000 \$145,455 + \$12,000 = \$157,455 Can purchase a home costing about \$157,455 Would this amount allow you to purchase a home in the area where you live? Warrenton, Virginia (zip codes: 20186, 20187, 20188) Yes Home values in Warrenton, Virginia are a little pricey for an income of \$48,000 per year. However, there are some homes and town houses currently listed for under \$157,000 http://www.zillow.com/homes/Warrenton,-Virginia-_rb/ Thanks for writing. Staff www.solving-math-problems.com