Joel earns $1,700 per month. If he spends $425 on rent each month, what percent of his income does he spend on rent?
A) $33 \frac{1}{3} \%$
B) $20 \%$
C) $40 \%$
D) $25 \%$
Answer (1)
Calculate the fraction of income spent on rent: 1700 425 .
Convert the fraction to a percentage by multiplying by 100: 1700 425 × 100 .
Simplify the expression to find the percentage: 25 .
Therefore, Joel spends 25% of his income on rent.
Explanation
Finding the Fraction of Income Spent on Rent First, we need to determine what fraction of Joel's income is spent on rent. To do this, we will divide the amount spent on rent by his total income.
Calculating the Fraction The fraction of income spent on rent is: 1700 425
Converting to Percentage Next, we need to convert this fraction to a percentage. To do this, we multiply the fraction by 100: 1700 425 × 100
Final Calculation and Answer Calculating the percentage: 1700 425 × 100 = 25 Therefore, Joel spends 25% of his income on rent.
Examples
Understanding percentages is crucial in managing personal finances. For example, if you want to save a certain percentage of your income each month, knowing how to calculate percentages helps you determine the exact amount you need to set aside. Similarly, when budgeting, you can use percentages to allocate your income to different categories like housing, food, transportation, and entertainment, ensuring you stay within your financial goals. This skill is also useful when comparing discounts or calculating taxes.
