If a man can borrow $78,000 to purchase a house and this is 2.5 times his annual salary, what is his annual salary?

To arrive at the man's annual salary, you can divide the amount he can borrow by the multiplication factor given. The question states that the loan amount of $78,000 is 2.5 times his annual salary.

To find the annual salary, you can set up the equation as follows:

Annual Salary = Borrowed Amount / Multiplication Factor

Annual Salary = $78,000 / 2.5

When you perform the division, you find:

Annual Salary = $78,000 / 2.5 = $31,200

Thus, the man's annual salary is indeed $31,200. This calculation confirms that B is the correct answer. Understanding this calculation is essential, as it showcases how to manipulate basic algebraic expressions to solve for unknown values in financial contexts, which is a crucial skill in real estate and personal finance.