For example, if an individual earned $50,000 last year and purchased a new car, you would expect that person to have paid about blank for the car. Similarly, if someone just paid $20,000 for a car, you could use this graph to estimate that this person's income was probably around blank .

Answer 1

To fill in the blanks in your example, we would typically reference a formula or guideline that relates car expenses to income. A common rule of thumb suggests that individuals should spend about 15% of their annual income on a car, including both the purchase price and ongoing costs.

1. If an individual earned $50,000 last year and purchased a new car, you would expect that person to have paid about $7,500 for the car (15% of $50,000).

2. Conversely, if someone just paid $20,000 for a car, you could use this guideline to estimate that this person's income was probably around $133,333 (since $20,000 is 15% of this amount).

In summary:

• Expect to pay about $7,500 for the car if earning $50,000.
• Estimate that an income was around $133,333 if someone paid $20,000 for a car.