Questions: A person has 1,550 in liabilities, monthly savings of 200, and monthly gross income of 2,000. What is the person's savings ratio?

A person has 1,550 in liabilities, monthly savings of 200, and monthly gross income of 2,000. What is the person's savings ratio?
Transcript text: A person has $\$ 1,550$ in liabilities, monthly savings of $\$ 200$, and monthly gross income of $\$ 2,000$. What is the person's savings ratio? Multiple Choice 2.35 0.10 0.16 0.77 12.90
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Solution

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Solution Steps

Step 1: Understand the Savings Ratio

The savings ratio is calculated as the ratio of monthly savings to monthly gross income. It is expressed as:

\[ \text{Savings Ratio} = \frac{\text{Monthly Savings}}{\text{Monthly Gross Income}} \]

Step 2: Substitute the Given Values

From the problem, the monthly savings are \$200, and the monthly gross income is \$2,000. Substituting these values into the formula:

\[ \text{Savings Ratio} = \frac{200}{2000} \]

Step 3: Simplify the Ratio

Simplify the fraction:

\[ \text{Savings Ratio} = \frac{200}{2000} = 0.10 \]

Final Answer

The savings ratio is \\(\boxed{0.10}\\). The correct choice is B.

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