Nationwide Mortgage Licensing System (NMLS) Practice Exam

If an applicant works 40 hours every week and is paid $13.52 per hour, what is the applicant's monthly income?

1. $2,163.20

2. $2,343.47

3. $2,379.52

4. $2,487.68

The correct answer is: $2,343.47

To determine the applicant's monthly income, we first need to calculate their weekly income. Since the applicant works 40 hours each week and earns $13.52 per hour, we multiply the number of hours by the hourly wage: Weekly Income = 40 hours/week × $13.52/hour = $540.80. Next, to find the monthly income, we multiply the weekly income by the number of weeks in a month. Typically, a month is considered to have approximately 4.33 weeks (52 weeks in a year divided by 12 months): Monthly Income = Weekly Income × 4.33 weeks/month = $540.80 × 4.33 = $2,343.47. This result shows that the monthly income, calculated based on a consistent 40-hour work week and the specified hourly wage, accurately reflects the expected earnings over an average month, thereby making the selection of the second option as the monthly income appropriate. This approach is essential for financial calculations, especially in contexts such as mortgage applications, where verifying an applicant's income profile is crucial.