American_Bankers_Association
CTFA · Question #16
Total monthly loan payments divided by monthly gross (before-tax) income; provides a measure of the ability to pay debts promptly is:
The correct answer is D. Debt service ratio. See the full explanation below for the reasoning.
Fiduciary and Trust Activities
Question
Total monthly loan payments divided by monthly gross (before-tax) income; provides a measure of the ability to pay debts promptly is:
Options
- ASolvency ratio
- BLiquidity ratio
- CSavings ratio
- DDebt service ratio
How the community answered
(37 responses)- A8% (3)
- B14% (5)
- C5% (2)
- D73% (27)
Topics
#debt service ratio#loan payments#gross income#financial ratios
Community Discussion
No community discussion yet for this question.