When considering how much debt to incur in student loans, you learn that it is wise to keep your student loan payment to 10% or less of your starting monthly income. Suppose you anticipate a starting annual salary of $48,000. Set up and solve an inequality that represents the amount of monthly debt for student loans that would be considered manageable.
A) The amount of monthly debt for student loans is $400 or more.
B) The amount of monthly debt for student loans is $390.
C) The amount of monthly debt for student loans is $390 or less.
D) The amount of monthly debt for student loans is $400 or less.
E) The amount of monthly debt for student loans is $390 or more.

Question

Quizplus · Accepted Answer

We know that the student loan payment should be 10% or less of the starting monthly income. 
So,

0.10 × (Starting annual salary) / (12 months) ≤ Monthly debt for student loans

0.10 × 48,000 / 12 ≤ Monthly debt for student loans

$400 ≤ Monthly debt for student loans

Therefore, the maximum manageable monthly debt for student loans is $400 or less. Thus, the correct choice is D.

When Considering How Much Debt to Incur in Student Loans