Mia Just Graduated from College

question 13

Multiple Choice

Mia just graduated from college. She accepted a position with a firm earning $50 per hour. She is expected to work 1,900 hours in a year. Using HUD guidelines, what is the maximum Mia should pay for rent on a monthly basis?

• A) $2,125.
• B) $2,200.
• C) $2,250.
• D) $2,375.

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Definitions:

Value Stocks

Stocks that traders believe are underpriced relative to their intrinsic value, often indicated by characteristics like low price-to-earnings ratios.

Constant-Growth DDM

A valuation model for stocks, assuming dividends grow at a constant rate indefinitely, used to calculate the present value of the expected dividends.

Beta

A measure of a stock's volatility in relation to the overall market, indicating the stock's risk compared to the market.

Risk-Free Rate

An interest rate that serves as a benchmark for the minimum return investors should expect because it carries no risk of financial loss.