Mary earns $3500 per month.After payroll deductions from the government,Mary takes home 85 percent of her salary.Mary wants to use a pay yourself first method and puts $330 into her savings account before spending anything and pays $200 towards her student loans.What is Mary's saving rate?

Question

Quizplus · Accepted Answer

Mary's take-home pay is 85% of $3500, which equals $2975. Her savings rate is calculated by adding her savings ($330) and student loan payment ($200), which totals $530, and then dividing by her take-home pay ($2975). This gives a saving rate of 17.8%, but since the student loan payment is not typically considered direct savings, only the $330 saved is considered. Thus, the saving rate is ($330 / $2975) * 100 = 11.1%.

Mary Earns $3500 Per Month