math word problem question

Question

Ben earns $48,000/yr (post-tax income) as an entry-level salesperson. He pays $1,000 / month in rent, $500 / month in student loan payments, and puts 5% of his post-tax income into a retirement account (per his parent’s guidance).



How much money does Ben have left every month to spend after he completes his existing payments?

Answer 1

Hi Tracy

There are many things going on in this problem, so read it carefully a few times.

One of the first things to notice is that his income is given in per year, while some expenses and the answer talk of per month.  So if he gets $48,000 per year, how much per month?  Since there are 12 months in a year, 48,000/12 = 4000 

Next, notice that most of his expenses are in dollars, but one is a percentage.  5% = .05   .05 * 4000 = 200.  Add his rent and student loan payment and the 200 in his retirement account and the answer will be how much he spends each month on those items.

 

The question is how much does he have left after these payments, so subtract the amount he spends on those items from the $4000 he gets a month, and that will be your answer.

 

Hope this helped.

 

Mary