Michelle Duncan wants to know what price home she can afford. Her annual gross income is $45.000. She owes $550 per month on other debts and expects her property taxes and homeowners insurance to cost $225 per month. She knows she can get an 8%, 30-year mortgage so her mortgage payment factor is 7.34. She expects to make a 20% down payment. What is Michelle's affordable home purchase price? Round your answer to the nearest $100. Hint 1: Use Exhibit 9-8 in the formula sheet. Hint 2: In step 2 use 38% of monthly gross income as a guideline for PITI plus other debt payments. $110,700 $88,600 $199,300 $42,500 $254,800