The formula to calculate the maximum rent (Rmax) is:
\[ \text{Rmax} = \text{GI} \times \text{RTI} \]
Where:
Maximum rent is the highest amount of rent that tenants can afford to pay based on their combined gross income and the maximum rent-to-income ratio allowed by law. This calculation helps ensure that tenants do not spend more than a reasonable portion of their income on rent.
Let's assume the following values:
Using the formula to calculate the maximum rent (Rmax):
\[ \text{Rmax} = \text{GI} \times \text{RTI} = 100,000 \times 0.30 = 30,000 \text{ dollars} \]
The maximum rent (Rmax) is $30,000 per year.
