Budgeting and Financial Decision Making

The video tutorial explains the concept of a balanced budget, where income equals expenses. Using Michael's weekly budget as an example, it shows that his expenses exceed his income, making it unbalanced. The tutorial suggests strategies to balance the budget, such as reducing spending on transportation and lunch, while emphasizing the importance of saving for college.

What is a balanced budget?

• When income equals expenses

• When income is greater than expenses

• When there is no income

• When expenses are greater than income

In Michael's budget example, what is the issue?

• His income is greater than his expenses

• His expenses are greater than his income

• His income and expenses are equal

• He has no expenses

Which of the following is NOT a suggested way for Michael to balance his budget?

• Spend less on the bus

• Spend less on lunch

• Not save for college

• Increase his income

Why is not saving for college considered a bad idea?

• Because it is not mentioned in the budget

• Because it will not affect the budget

• Because saving for college is important

• Because it is not a significant expense

What are some ways Michael can reduce his expenses?

• Buy more expensive lunch

• Walk to school and make his own lunch

• Take a taxi to school

• Increase his savings for college