Madeline Rollins is trying to decide whether she can afford a loan she needs in order to go to chiropractic school. Right now Madeline is living at home and works in a shoe store, earning a gross income of $820 per month. Her employer deducts a total of $145 for taxes from her monthly pay. Madeline also pays $95 on several credit card debts each month. The loan she needs for chiropractic school will cost an additional $120 per month. Help Madeline make her decision by calculating her debt payments-to-income ratio with and without the college loan. (Remember the 20 percent rule.)

Conclusion: Madeline should not ask for the loan

1. With college loan:

2. Without the college loan

Explanation:

Calculate the DTI for both scenaries, with and without the college loan.

                                            With college loan     W/O college loan

Monthly debt payments($)

                 Sub-total                    360                              240

Montly gross income ($)             820                              820

1. With college loan:

2. Without the college loan

There are several rules to assess if a DTI is good or not.

Some of those rules include that:

Since the DTI is already higher than 20% the conclusion is that Madeline should not ask for the loan.

i think the answer is a. science center.