Final answer:
Ben's net worth is calculated by adding his home equity, car equity, and savings together and subtracting his credit card debt. His home equity is $75,000, car equity is $18,000, savings account holds $5,000, and he owes $1,400 on his credit card, leading to a net worth of $96,600, which is option (a).
Step-by-step explanation:
To calculate Ben's net worth, we need to subtract his liabilities from his assets.
- Ben's townhome is worth $195,000, and he still owes $120,000 on it, so his home equity is this difference, which is $75,000.
- He has $5,000 in savings, which is an asset.
- Ben has a credit card balance of $1,400, which is a liability.
- His car is worth $38,000, and Ben owes $20,000 on it, meaning his equity in the car is $18,000.
Now, we sum up the equities and savings and subtract the liabilities:
Net Worth = Home Equity + Car Equity + Savings - Credit Card Debt
Net Worth = $75,000 (home) + $18,000 (car) + $5,000 (savings) - $1,400 (credit card)
Net Worth = $96,600
Therefore, Ben's net worth is $96,600, which corresponds to option (a).