Fixed and Variable Expenses

What is an expense?

• The amount of money you spend.

• The amount of money you receive.

A fixed expense:

• Stays the same each week

• Is different each week

Which of the following is a fixed expense?

• subscription, gifts, groceries

• rent, insurance, car payment

• rent, gas, clothing

Cell phone bills can be either fixed or variable, but why?

Diego has a cell phone plan that charges $125 per month for unlimited calls, texts, and data. Valarie has a cell phone plan that charges $50 for unlimited calls, but texts and data are extra based on usage. Which statement is true?

• Valarie’s cell phone bill is a variable expense because the amount is the same every month.

•  Valarie’s cell phone bill is a fixed expense because the amount usually changes every month.

• Diego’s cell phone bill is a fixed expense because the amount is the same every month.

• Deigo’s cell phone bill is a variable expense because the amount usually changes every month.

Expenses that change each week are called:

• Variable expenses

• Variable income

• Fixed expenses

Which has all three of the same type of expense?

• Groceries, Rent, Insurance

• Gas, Clothing, Entertainment

• Car Payment, Rent, Entertainment

What is an example of a fixed expense?

• Car payment

• Groceries

What is an example of a variable expense? 

• Insurance

• Money spent on clothes

• House payment