**Question 1.**

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**Question 2.**

∙ Spend no more than 28% of your gross monthly income for your mortgage payment.

∙ Spend no more than 36% of your gross monthly income for your total monthly debt.

Round all calculations to the nearest dollar, if necessary.

Suppose that your gross annual income is $96,000.

(a) What is the maximum amount you should spend each month on a mortgage payment?

(b) What is the maximum amount you should spend each month for total credit obligations?

(c) If your monthly mortgage payment is 65% of the maximum amount you can afford, what is the maximum amount you should spend each month for all other debt?

▸ (a) $2240; (b) $2880; (c) $1424

▸ (a) $26,880; (b) $34,560; (c) $17,088

▸ (a) $2240; (b) $2880; (c) $1456

▸ (a) $2240; (b) $2880; (c) $368