18. Disclotmer: Any connections to real people are purely Imaginary, Jayden and Shamine Williams are considering buying a house and are researching the potential costs. Their adjusted gross income is 135,511 The monthly mortgage payment for the house they want would be 1,233. The annual property taxes would be 9,400 and the homeowner's insurance premium would cost them 876 per year. Will the bank lend them 190,000 to purchase the house, If other expenses are not considered at this point? A. Yes, their front-end ratio is less than 40% B. No, their annual adjusted gross income is too low. C. Yes, their front-end ratio is less than 18% D. Yes, their front-end ratlo is less than 28% A B C D

To determine whether the bank will lend Jayden and Shamine Williams $\$190,000$ to purchase the house, we need to calculate their front-end ratio. The front-end ratio is the percentage of their monthly gross income that goes towards housing expenses, which include the monthly mortgage payment, property taxes, and homeowner's insurance premium.<br /><br />First, let's calculate their monthly property taxes and homeowner's insurance premium:<br />- Annual property taxes: $\$9,400$<br />- Monthly property taxes: $\frac{9,400}{12} = \$783.33$<br />- Annual homeowner's insurance premium: $\$876$<br />- Monthly homeowner's insurance premium: $\frac{876}{12} = \$73$<br /><br />Next, let's calculate their monthly gross income:<br />- Annual adjusted gross income: $\$135,511$<br />- Monthly gross income: $\frac{135,511}{12} = \$11,255.92$<br /><br />Now, let's calculate their monthly housing expenses:<br />- Monthly mortgage payment: $\$1,233$<br />- Monthly property taxes: $\$783.33$<br />- Monthly homeowner's insurance premium: $\$73$<br /><br />Total monthly housing expenses: $1,233 + 783.33 + 73 = \$2,089.33$<br /><br />Finally, let's calculate their front-end ratio:<br />- Front-end ratio: $\frac{2,089.33}{11,255.92} \approx 0.185$ or $18.5\%$<br /><br />Based on the given options, the correct answer is:<br />C. Yes, their front-end ratio is less than $18\%$