Understanding Personal Budgets

Mason is planning his finances for the month. What is a personal budget?

• A plan for spending and saving money

• A list of all your favorite things

• A schedule for your daily activities

• A collection of your favorite books

Answer explanation

A personal budget is specifically defined as a plan for spending and saving money, helping individuals manage their finances effectively. The other options do not relate to financial planning.

Olivia is planning her monthly budget. Which of the following is an example of a fixed expense?

• Rent

• Groceries

• Entertainment

• Clothing

Answer explanation

Rent is a fixed expense because it remains constant each month, unlike groceries, entertainment, and clothing, which can vary in amount.

Rohan is reviewing his monthly expenses. Which of the following is an example of a variable expense?

• Mortgage

• Utility bills

• Car insurance

• Internet subscription

Answer explanation

Utility bills are variable expenses because they can fluctuate each month based on usage. In contrast, mortgage, car insurance, and internet subscriptions are typically fixed expenses.

• 10%

• 20%

• 25%

• 30%

Answer explanation

To find the percentage spent on groceries, divide the grocery spending (1,000) by the total income (5,000) and multiply by 100. (1,000 / 5,000) * 100 = 20%. Thus, the correct answer is 20%.

True or false. When Grace is planning her monthly expenses, taxes are considered a part of her personal budget.

• True

• False

Answer explanation

True. Taxes are a necessary expense that individuals must account for in their personal budgets, as they impact overall financial planning and cash flow.

Maya is planning her monthly expenses. What is the minimum household budget?

• The least amount of money needed to cover basic living expenses

• The maximum amount of money you can spend in a month

• The amount of money you save each month

• The total amount of money you earn in a year

Answer explanation

The minimum household budget refers to the least amount of money needed to cover basic living expenses, such as housing, food, and utilities, making it essential for financial planning.

Tags

CCSS.6.RP.A.3B

Liam and Scarlett are planning their monthly expenses. Which tool can they use to determine the minimum household budget for their family?

• A calculator

• A family budget estimator

• A calendar

• A shopping list

Answer explanation

A family budget estimator is specifically designed to calculate and outline the minimum household budget for a family, making it the most suitable tool for this purpose compared to the other options.

Tags

CCSS.2.OA.A.1

Harper's family needs a minimum household budget of $3,600 per month, what is the minimum annual income required?

• $36,000

• $43,200

• $48,000

• $50,000

Answer explanation

To find the minimum annual income, multiply the monthly budget by 12: $3,600 x 12 = $43,200. This is the minimum income required to meet the household budget.

Tags

CCSS.6.RP.A.3B

Benjamin is creating a personal budget. Which of the following is NOT a component of his budget?

• Income

• Planned savings

• Favorite movies

• Taxes

Answer explanation

A personal budget typically includes components like income, planned savings, and taxes. 'Favorite movies' is not a financial component and therefore is NOT part of a personal budget.

If Kai's family spends 500 on utilities and 1,500 on rent, what percentage of their $4,000 monthly income is spent on these two expenses combined?

• 25%

• 50%

• 40%

• 30%

Answer explanation

The total spent on utilities and rent is 500 + 1500 = 2000. To find the percentage of their $4000 income spent, calculate (2000 / 4000) * 100 = 50%. Thus, the correct answer is 50%.

Tags

CCSS.6.RP.A.3C