Write each ratio as a unit ratio and interpret the result. A...

Write each ratio as a unit ratio and interpret the result.
A family is seeking a mortgage to purchase a new home. If the mortgage is approved, the new payment will be $\$ 945 .$ If the gross monthly income is $\$ 3650,$ what is the payment-to-income ratio?

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Key Concepts

Ratio

A ratio is a quantitative relationship between two numbers indicating how many times one value contains or is contained within the other. It serves as a comparison of two quantities of the same kind, which is fundamental in various areas of mathematics and real-world applications.

Unit Ratio

A unit ratio is an expression of a ratio in which the second term is 1. It simplifies comparisons by showing the amount of one quantity in relation to a single unit of another quantity, thereby making it easier to understand and interpret the relationship between the two.

Payment-to-Income Ratio

The payment-to-income ratio is a specific application of the concept of ratio used in financial contexts to compare periodic payment obligations (such as a mortgage payment) to the gross monthly income of an individual or family. This ratio is crucial in evaluating financial burden and affordability, as it indicates the proportion of income that will be allocated towards the payment.

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