If a two-person EMS household has a monthly take-home of 6,500 and wants to save 20% of take-home, how much should they allocate monthly to savings?

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Multiple Choice

If a two-person EMS household has a monthly take-home of 6,500 and wants to save 20% of take-home, how much should they allocate monthly to savings?

Explanation:
Saving a portion of take-home pay means multiply the take-home amount by the savings rate. With a monthly take-home of 6,500 and a target of 20%, that’s the same as one-fifth. One-fifth of 6,500 is 6,500 ÷ 5 = 1,300 (or 6,500 × 0.20 = 1,300). So they should set aside 1,300 each month for savings. The other options represent less or more than 20% of 6,500.

Saving a portion of take-home pay means multiply the take-home amount by the savings rate. With a monthly take-home of 6,500 and a target of 20%, that’s the same as one-fifth. One-fifth of 6,500 is 6,500 ÷ 5 = 1,300 (or 6,500 × 0.20 = 1,300). So they should set aside 1,300 each month for savings. The other options represent less or more than 20% of 6,500.

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