. A housing down payment is money that a
prospective buyer provides up front when
purchasing a home and is usually a per-
cent of the purchase price of the home. A
lender typically requires private mortgage
insurance (PMI) when the buyer's down
payment is less than 20% of the purchase
price. To secure a mortgage, buyers also
need to have additional cash on hand
for closing costs and prepaid property
tax. Suppose a buyer wants to purchase
a $375,000 house and must have $7,200
on hand for closing costs and property
tax. Which of the following inequalities
represents the total funds (f) the buyer
must have on hand to secure the mortgage
without having to pay PMI?
A) f≤0.2(375,000) + 7,200
B) f≥0.2(375,000) +7,200
C) f≤0.2(375,000 +7,200)
D) f≥0.2(375,000 +7,200)