4
QuizMultiple Choice

Understanding Net Worth — Quiz

Question 4 • Economics and Personal Finance

Mr. Morgan earns 38 dollars comma 000 a year as a salesperson and a 5 percent commission on all his sales. He has a mortgage of 910 dollars a month and pays 175 dollars a month for utilities. Mr. Morgan owns a rental property for which he receives 680 dollars per month. Which is a liability?

Answer
A
the mortgage
B
the commission
C
the yearly salary
D
the rental property

Explanation

A liability is a debt or financial obligation that must be paid. The mortgage is a monthly debt payment of $910, so it is a liability. The commission, salary, and rental property are sources of income or an asset, not liabilities.

AI-written and checked against the verified answer.

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