3. Calculating the Debt-to-Equity Ratio . Robert Thumme owns a $140,000 townhouse and still has an unpaid mortgage of

$110,000. In addition to his mortgage, he has the following liabilities:

Visa $ 565 MasterCard $ 480 Discover card $ 395 Education loan $ 920 Personal bank loan $ 800 Auto loan $4,250 Total $7,410 Robert’s net worth (not including his home) is about $21,000. This equity is in mutual funds, an automobile, a coin collection, furniture, and other personal property. What is Robert’s debt-to-equity ratio? Has he reached the upper limit of debt obligations?

Explain. (Obj. 3)