Meet JACK: You are a 36-year-old bachelor who has a great condo near Green Valley and Paseo Verde. You bought when the market was low for $28,000 and now it is worth $178,000. But you are ready to propose to your long time steady girlfriend and think it would be best to settle down in

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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"life scenario"
Meet JACK: You are a 36-year-old bachelor
who has a great condo near Green Valley
and Paseo Verde. You bought when the
market was low for $28,000 and now it is
worth $178,000. But you are ready to
propose to your long time steady girlfriend
and think it would be best to settle down in
a single family house in the same area.
Together, you would take home about
$74,000 per year. You have health
insurance through work, and could add
your spouse at no charge. You have no
savings, other than the equity in your
condo. You own your car. Your credit score
is 790.
Question 1
What is the price range of the home
you will search for?
Your down payment may be all or
some of your money available, justify
why you use the amount you do.
Justify your home price mathema!cally
(some references to consider are the
3.5 !mes your salary rule (as in your
book), the 30% rule, or the zillow home
affordability calculator).
Transcribed Image Text:"life scenario" Meet JACK: You are a 36-year-old bachelor who has a great condo near Green Valley and Paseo Verde. You bought when the market was low for $28,000 and now it is worth $178,000. But you are ready to propose to your long time steady girlfriend and think it would be best to settle down in a single family house in the same area. Together, you would take home about $74,000 per year. You have health insurance through work, and could add your spouse at no charge. You have no savings, other than the equity in your condo. You own your car. Your credit score is 790. Question 1 What is the price range of the home you will search for? Your down payment may be all or some of your money available, justify why you use the amount you do. Justify your home price mathema!cally (some references to consider are the 3.5 !mes your salary rule (as in your book), the 30% rule, or the zillow home affordability calculator).
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