AnswersPersonal Finance - SC 26-27 For CreditPrinciples of Financial Planning

3.11 Budgeting Answers

23 verified answers1 views
21
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What effect would a tax increase have on income?

A
It would reduce gross income.
B
It would not affect net income.
C
It would increase net income.
D
It would not affect gross income.
22
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Why is net income lower than gross income?

A
fixed spending
B
budgets
C
withholdings
D
discretionary spending
23

To create a balanced budget, one must make sure to

A
spend as little as possible.
B
pay credit card payments first.
C
spend less than or equal to income.
D
pay off debts first.
24

Which is an example of an income deduction?

a
an unexpected salary cut
w
wages lost due to illness
v
vacation budget
r
retirement savings
25

[BLANK]

A
actual
B
potential
C
likely
26

Look at this monthly budget.Monthly Budget

Question illustration
A
Add to fixed expenses.
B
Decrease food expenses.
C
Reduce rent payments.
D
Increase total income.
27

To create a balanced budget, one must make sure to

s
spend as little as possible.
p
pay credit card payments first.
s
spend less than or equal to income.
p
pay off debts first.
28

[BLANK]

A
variable
B
fixed
C
uncertain
29

Which is an example of an income deduction?

A
an unexpected salary cut
B
wages lost due to illness
C
vacation budget
D
retirement savings
30

Which is the best way to achieve long-term financial goals?

A
Spend less on mandatory expenses.
B
Eliminate short-term financial goals.
C
Increase discretionary expenditures.
D
Save more money from net income.
31

From what part of income should someone take savings?

A
what otherwise would be fixed expenses
B
gross income, before other deductions
C
what otherwise would be discretionary income
D
gross income, along with other deductions
32

When should fixed and variable monthly budgeted expenses first be planned?

A
at the end of each month
B
day by day during the month
C
at the start of each month
D
at least twice per month
33

A short-term financial goal might include saving for

A
a down payment on a house.
B
a piece of furniture.
C
a child’s college fund.
D
one’s retirement.
34

Mindy wants to save money to buy a new couch.Which would be the best strategy for her to accomplish her goal?

A
adopt a dog from a shelter
B
stop paying her credit card bill
C
decrease the budget for basic food needs
D
forgo watching movies online or in the theater
35

Leo’s car broke down, and he must find money in his limited budget to pay the repair bill.Which of the following is the best solution for Leo to handle the unplanned spending?

A
Leo forgoes going out to dinner.
B
Leo forgoes paying the rent on his apartment.
C
Leo forgoes paying his water bill.
D
Leo forgoes paying his electricity bill.

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