Nicole makes $2,000 per month. Each month, she spends $400 on credit card payments, $100 on a store credit, and $350 on an auto loan. Does she have excessive debt?
Yes, because her debt-to-income ratio is 42.5 percent.
No, because her debt-to-income ratio is 25 percent.
No, because her debt-to-income ratio is 42.5 percent.
Yes, because her debt-to-income ratio is 25 percent.