Answer the following. Round all numbers to the nearest dollar.Helena is a college student. She works part-time as a barista and earns about $325 a week after taxes, including tips. She has a scholarship that pays $1500 per semester and she attends two semesters a year. She hopes to work full-time in the summer and should make $2800 a month after taxes for 3 months, not including the $325 she will also earn as a barista through the summer. She uses her dad's car at no cost other than gasoline and her own car insurance. She lives at home for free and quickly jots down these ongoing expenses.Smart phone $175 per monthClothes and personal items $120 per weekInsurance $150 per monthEntertainment $90 per weekTuition $7200 per semesterTextbooks and school supplies $430 per

Question

semesterGasoline $50 per monthTo make it easy, assume the income she receives in the summer as well as the scholarship funds are spread out over 12 months in equal amounts. Find her average monthly after-tax income, average monthly expense based on the numbers above, and the difference between the two. What expenses has she not considered that she should have? Based on the numbers above, how much does she need to borrow per month on average? Assuming all numbers stay the same and ignoring anything she might have failed to list, find the debt she will accumulate in an interest-free Stafford loan if she goes to school for 4 years (assume 48 months.)

What will be an ideal response?

Answer 1

Monthly income -- $2358; monthly expenses -- $2557; difference -- $199 more in spending than income. She has forgotten about other expenses (unexpected expense), medical expenses, and probably some food costs she is likely to have. She needs to borrow about $199 per month, which accumulates to $9552 in 48 months in an interest-free loan.