It is currently 17 Nov 2017, 18:18

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Close

Request Expert Reply

Confirm Cancel

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

In Millington, a city of 50,000 people, Mercedes Pedrosa, a

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
Manager
Manager
avatar
Joined: 11 Jul 2004
Posts: 119

Kudos [?]: 33 [0], given: 0

In Millington, a city of 50,000 people, Mercedes Pedrosa, a [#permalink]

Show Tags

New post 18 Jun 2005, 07:41
00:00
A
B
C
D
E

Difficulty:

(N/A)

Question Stats:

0% (00:00) correct 0% (00:00) wrong based on 0 sessions

HideShow timer Statistics

In Millington, a city of 50,000 people, Mercedes Pedrosa, a realtor, calculated that a family with Millington’s median family income, $28,000 a year, could afford to buy Millington’s median-priced $77,000 house. This calculation was based on an 11.2 percent mortgage interest rate and on the realtor’s assumption that a family could only afford to pay up to 25 percent of its income for housing.
Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?
(A) Millington’s total population was 45,000 people.
(B) Millington’s median annual family income was $27,000.
(C) Millington’s median-priced house cost $80,000.
(D) The rate at which people in Millington had to pay mortgage interest was only 10 percent.
(E) Families in Millington could only afford to pay up to 22 percent of their annual income for housing.

Kudos [?]: 33 [0], given: 0

VP
VP
avatar
Joined: 30 Sep 2004
Posts: 1480

Kudos [?]: 425 [0], given: 0

Location: Germany
 [#permalink]

Show Tags

New post 18 Jun 2005, 08:43
D) will explain if correct
_________________

If your mind can conceive it and your heart can believe it, have faith that you can achieve it.

Kudos [?]: 425 [0], given: 0

Manager
Manager
avatar
Joined: 11 Jul 2004
Posts: 119

Kudos [?]: 33 [0], given: 0

 [#permalink]

Show Tags

New post 18 Jun 2005, 17:28
correct indeed. Please explain your answer
thanks

Kudos [?]: 33 [0], given: 0

Manager
Manager
avatar
Joined: 04 May 2005
Posts: 104

Kudos [?]: 15 [0], given: 0

Location: Austin, Texas
Re: CR: Millington Realtor HARD [#permalink]

Show Tags

New post 18 Jun 2005, 21:13
damit wrote:
Which of the following corrections of a figure appearing in the passage above, if it were the only correction that needed to be made, would yield a new calculation showing that even incomes below the median family income would enable families in Millington to afford Millington’s median-priced house?

(D) The rate at which people in Millington had to pay mortgage interest was only 10 percent.


Doesn't take a finance major to see that we're looking for an answer choice in which an even poorer family can still afford to buy a house based on the formulation described.

(A) is irrelevent to the affordability formula, and B/C/E introduce circumstances that would make it more exepensive to buy a house.

Only (D) has the effect of making mortgages cheaper owing to a lower interest rate, and therefore accessible to even lower-income families than the median.

Kudos [?]: 15 [0], given: 0

SVP
SVP
User avatar
Joined: 05 Apr 2005
Posts: 1706

Kudos [?]: 96 [0], given: 0

Re: CR: Millington Realtor HARD [#permalink]

Show Tags

New post 19 Jun 2005, 07:39
All, except D, weaken the ability of the people to buy a house in Millington.

Kudos [?]: 96 [0], given: 0

Manager
Manager
avatar
Joined: 11 Jul 2004
Posts: 119

Kudos [?]: 33 [0], given: 0

 [#permalink]

Show Tags

New post 19 Jun 2005, 12:25
hmm i missed read this question. this is actually quite easy
thanks all

Kudos [?]: 33 [0], given: 0

  [#permalink] 19 Jun 2005, 12:25
Display posts from previous: Sort by

In Millington, a city of 50,000 people, Mercedes Pedrosa, a

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  

Moderators: GMATNinjaTwo, GMATNinja



GMAT Club MBA Forum Home| About| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.