Angela has a monthly gross income of $3,000 and her expenses are $1,200.What is her back-end ratio?

Question

Quizplus · Accepted Answer

The back-end ratio is calculated by dividing total monthly debt payments by gross monthly income. Since Angela's expenses are $1,200, her debt payments would be $0. Therefore, her back-end ratio would be $0/$3,000 = 0%. However, it is important to note that a back-end ratio of 0% does not necessarily mean financial stability as it may indicate a lack of credit history or debt obligations. Therefore, assuming Angela does not have any debt payments, the closest answer choice would be C, which is 40%.

Angela Has a Monthly Gross Income of $3,000 and Her