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In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.
Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?
- a)Millington’s total population was 45,000 people.
- b)Millington’s median annual family income was $27,000.
- c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.
- d)Millington’s median-priced house cost $80,000.
- e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.
Correct answer is option 'C'. Can you explain this answer?
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In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, c...
A. House parties at which numerous individuals gather to view popular television shows on one television set have increased three hundred percent during the past year.
This option suggests that more people are gathering to watch TV shows on a single television set, indicating that the demand for individual televisions might be decreasing. However, it doesn't directly support the argument that the average number of residents per household will surpass the number of televisions.
This option suggests that more people are gathering to watch TV shows on a single television set, indicating that the demand for individual televisions might be decreasing. However, it doesn't directly support the argument that the average number of residents per household will surpass the number of televisions.
B. More than one million legal immigrants enter the United States each year.
This option provides information about the number of legal immigrants entering the United States each year. While it is an interesting fact, it does not directly relate to the argument about the affordability of televisions or the average number of residents per household.
This option provides information about the number of legal immigrants entering the United States each year. While it is an interesting fact, it does not directly relate to the argument about the affordability of televisions or the average number of residents per household.
C. New devices such as video-enabled personal digital assistants and music players are increasingly purchased for use as a primary source of information and entertainment.
This option supports the argument by suggesting that people are purchasing alternative devices for their information and entertainment needs. If individuals are relying on devices other than televisions, it implies that the demand for televisions may decrease, which aligns with the argument presented.
This option supports the argument by suggesting that people are purchasing alternative devices for their information and entertainment needs. If individuals are relying on devices other than televisions, it implies that the demand for televisions may decrease, which aligns with the argument presented.
D. As new technologies become more commonplace, manufacturing and retail costs normally decline.
This option provides a general statement about the decline in manufacturing and retail costs as new technologies become more common. While it is true, it doesn't directly support the argument that televisions are becoming too expensive for the typical consumer or that the average number of residents per household will surpass the number of televisions.
This option provides a general statement about the decline in manufacturing and retail costs as new technologies become more common. While it is true, it doesn't directly support the argument that televisions are becoming too expensive for the typical consumer or that the average number of residents per household will surpass the number of televisions.
E. As a result of technological advances, new televisions are increasingly enabled with some features, such as Internet browsing, traditionally associated with other household devices.
This option highlights that new televisions are incorporating features traditionally associated with other devices. While this information is interesting, it doesn't directly support the argument that televisions are becoming too expensive for the typical consumer or that the average number of residents per household will surpass the number of televisions.
This option highlights that new televisions are incorporating features traditionally associated with other devices. While this information is interesting, it doesn't directly support the argument that televisions are becoming too expensive for the typical consumer or that the average number of residents per household will surpass the number of televisions.
Among the options provided, option C is the one that most strongly supports the argument by suggesting a shift in consumer behavior towards alternative devices for entertainment and information purposes.
Most Upvoted Answer
In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, c...
A. House parties at which numerous individuals gather to view popular television shows on one television set have increased three hundred percent during the past year.
This option suggests that more people are gathering to watch TV shows on a single television set, indicating that the demand for individual televisions might be decreasing. However, it doesn't directly support the argument that the average number of residents per household will surpass the number of televisions.
This option suggests that more people are gathering to watch TV shows on a single television set, indicating that the demand for individual televisions might be decreasing. However, it doesn't directly support the argument that the average number of residents per household will surpass the number of televisions.
B. More than one million legal immigrants enter the United States each year.
This option provides information about the number of legal immigrants entering the United States each year. While it is an interesting fact, it does not directly relate to the argument about the affordability of televisions or the average number of residents per household.
This option provides information about the number of legal immigrants entering the United States each year. While it is an interesting fact, it does not directly relate to the argument about the affordability of televisions or the average number of residents per household.
C. New devices such as video-enabled personal digital assistants and music players are increasingly purchased for use as a primary source of information and entertainment.
This option supports the argument by suggesting that people are purchasing alternative devices for their information and entertainment needs. If individuals are relying on devices other than televisions, it implies that the demand for televisions may decrease, which aligns with the argument presented.
This option supports the argument by suggesting that people are purchasing alternative devices for their information and entertainment needs. If individuals are relying on devices other than televisions, it implies that the demand for televisions may decrease, which aligns with the argument presented.
D. As new technologies become more commonplace, manufacturing and retail costs normally decline.
This option provides a general statement about the decline in manufacturing and retail costs as new technologies become more common. While it is true, it doesn't directly support the argument that televisions are becoming too expensive for the typical consumer or that the average number of residents per household will surpass the number of televisions.
This option provides a general statement about the decline in manufacturing and retail costs as new technologies become more common. While it is true, it doesn't directly support the argument that televisions are becoming too expensive for the typical consumer or that the average number of residents per household will surpass the number of televisions.
E. As a result of technological advances, new televisions are increasingly enabled with some features, such as Internet browsing, traditionally associated with other household devices.
This option highlights that new televisions are incorporating features traditionally associated with other devices. While this information is interesting, it doesn't directly support the argument that televisions are becoming too expensive for the typical consumer or that the average number of residents per household will surpass the number of televisions.
This option highlights that new televisions are incorporating features traditionally associated with other devices. While this information is interesting, it doesn't directly support the argument that televisions are becoming too expensive for the typical consumer or that the average number of residents per household will surpass the number of televisions.
Among the options provided, option C is the one that most strongly supports the argument by suggesting a shift in consumer behavior towards alternative devices for entertainment and information purposes.
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In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, c...
Understanding the Calculation
In the original scenario, Mercedes Pedrosa used the median family income of $28,000 to determine how much a family could afford for housing. With the assumption that families can spend up to 25% of their income on housing, the calculation was as follows:
- **Monthly Income**: $28,000 / 12 = $2,333.33
- **Affordable Housing Cost**: 25% of $2,333.33 = $583.33 per month
Using an 11.2% mortgage interest rate, this monthly payment translates to a maximum loan amount that can be afforded, based on typical mortgage calculations.
Impact of Mortgage Interest Rate
If the mortgage interest rate were to decrease to 10% (as suggested in option C), the monthly payment of $583.33 would allow for a larger loan amount. This is because lower interest rates reduce the monthly payment required to service a given loan amount.
- **Lower Interest Rate**: Reduces monthly payments for the same loan amount.
- **Higher Affordability**: Lower payments mean families can afford homes priced above $77,000 even with lower incomes.
Conclusion
By changing the mortgage interest rate from 11.2% to 10%, it adjusts the affordability calculation, allowing families with incomes below the median of $28,000 potentially to afford Millington's median-priced house. This adjustment demonstrates that even families earning less than the median income can still have the financial means to purchase a home if the interest rates are more favorable.
Thus, option C is the correct choice.
In the original scenario, Mercedes Pedrosa used the median family income of $28,000 to determine how much a family could afford for housing. With the assumption that families can spend up to 25% of their income on housing, the calculation was as follows:
- **Monthly Income**: $28,000 / 12 = $2,333.33
- **Affordable Housing Cost**: 25% of $2,333.33 = $583.33 per month
Using an 11.2% mortgage interest rate, this monthly payment translates to a maximum loan amount that can be afforded, based on typical mortgage calculations.
Impact of Mortgage Interest Rate
If the mortgage interest rate were to decrease to 10% (as suggested in option C), the monthly payment of $583.33 would allow for a larger loan amount. This is because lower interest rates reduce the monthly payment required to service a given loan amount.
- **Lower Interest Rate**: Reduces monthly payments for the same loan amount.
- **Higher Affordability**: Lower payments mean families can afford homes priced above $77,000 even with lower incomes.
Conclusion
By changing the mortgage interest rate from 11.2% to 10%, it adjusts the affordability calculation, allowing families with incomes below the median of $28,000 potentially to afford Millington's median-priced house. This adjustment demonstrates that even families earning less than the median income can still have the financial means to purchase a home if the interest rates are more favorable.
Thus, option C is the correct choice.
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In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer?
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In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer? for GMAT 2024 is part of GMAT preparation. The Question and answers have been prepared according to the GMAT exam syllabus. Information about In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for GMAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer?.
In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer? for GMAT 2024 is part of GMAT preparation. The Question and answers have been prepared according to the GMAT exam syllabus. Information about In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for GMAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer?.
Solutions for In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for GMAT.
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In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer?, a detailed solution for In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer? has been provided alongside types of In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?a)Millington’s total population was 45,000 people.b)Millington’s median annual family income was $27,000.c)The rate at which people in Millington had to pay mortgage interest was only 10 percent.d)Millington’s median-priced house cost $80,000.e)Families in Millington could only afford to pay up to 22 percent of their annual income for housing.Correct answer is option 'C'. Can you explain this answer? tests, examples and also practice GMAT tests.
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