Fixed vs Variable Expenses in Budgeting

What are fixed expenses?

• Costs that vary each month

• Costs that are consistent and mandatory

• Costs that are always luxury items

• Optional costs

Which of the following is typically considered a variable expense?

• Rent payments

• Dining out

• Utility bills

• Insurance payments

Can fixed expenses be adjusted?

• Only during financial crises

• Yes, by choosing cheaper options

• No, they are always fixed

• Fixed expenses cannot be determined

How much does it cost to live in an apartment or with a friend per month as mentioned?

• $2000

• $1000

• $500

• $1500

What is an example of adjusting a fixed expense?

• None of the above

• Going to movies frequently

• Choosing a cheaper living arrangement

• Buying luxury items

What is the cost of groceries for two weeks as mentioned?

• $50

• $100

• $200

• $150

What is the monthly cost of eating out every day for lunch and dinner as mentioned?

• $600

• $500

• $400

• $300

What distinguishes a need from a want in the context of expenses?

• Wants are essential for survival

• Needs are always more expensive

• Needs are essential, wants are not

• Wants are usually fixed expenses

Which of the following is a correct statement about variable expenses?

• They are necessary for basic living

• They include rent and insurance

• They can include entertainment and dining out

• They are fixed and cannot be adjusted

Which option represents a cheaper choice for a need?

• Buying a big house

• Purchasing luxury cars

• Living in an apartment

• Eating out daily