Evaluating debt safety ratio. Use worksheet DropBox link provided. Chapter 6

3. Diana Wade is evaluating her debt safety ratio. Her monthly take-is $3,320. Each month, she pays $380 for an auto loan, $120 on a personal line of credit, $60 on a department store charge card, and $85 on her bank credit card. Complete attached worksheet by listing Dianas outstanding debts, and then calculate her debt safety ratio. Given her current take-home pay, what is the maximum amount of monthly debt payments that Diana can have if she wants her debt safety ratio to be 12.5 percent? Given her current monthly debt payment load, what would Dianas take-home pay have to be if she wanted a 12.5 percent debt safety ratio?

https://www.dropbox.com/s/8rvuo7a0l2oibn4/ws%20ch%206.xls?dl=0

Choosing between credit cards.

7. Otis Hopkins recently graduated from college and is evaluating two credit cards. Card A has an annual fee of $75 and an interest rate of 9 percent. Card B has no annual fee and an interest rate of 16 percent. Assuming that Otis intends to carry no balance and pay off his charges in full each month, which card represents the better deal? If Otis expected to carry a significant balance from one month to the next, which card would be better? Explain.

Calculating credit card interest.

8. Lola Schneider a student at State College, has a balance of $380 on her retail charge card? If the store levies a finance charge of 21 percent per year, how much monthly interest will be added to Lolas account?