(i) The money you spend on your needs and wants may be termed as_______.
(a) budgets
(b) incomes
(c) expenses
Correct Answer is Option (c)
(ii) A set amount or exact amount which is incurred every time not depending on the usage or consumption is called a s __________ .
(a) Fixed expenses
(b) Variable expenses
(c) Cash management
Correct Answer is Option (a)
(iii) In a budget table, under fixed expenses ___________ should be first item which will help us to save money.
(a) Paying loans
(b) Paying rent
(c) Pay yourself first
Correct Answer is Option (c)
(iv) Payment of gas bill based on the usage is an example o f _________ .
(a) Fixed expenses
(b) Variable expenses
(c) Income generating expenses
Correct Answer is Option (c)
(v) ______________is extremely important to meet our goals.
(a) Saving
(b) Expense
(c) Loan repayment
Correct Answer is Option (c)
(i) Expenses can be classified in to two categories namely______ and ______.
(ii) ______ helps us to use our money for our needs and wants, and achieve our goals.
(iii) Budget has two main parts namely ______ and ______.
(iv) _______ is a simple trick to grow our money and become wealthy.
(v) ______ minus ______ is known as money left over for future needs.
(i) Fixed and Variable
(ii) Budget
(iii) Income and expenses
(iv) Saving
(v) Income minus expenses
(i) Expenses - Setting aside money
(ii) Fixed expenses - handling money coming in and going out
(iii) Variable expenses - no change in total amount
(iv) Cash management - money going out
(v) Savings - change in amount
(i) Expenses - Money going out
(ii) Fixed expenses - No change in total amount
(iii) Variable expenses - Change in amount
(iv) Cash management - Handling money coming in and going out
(v) Savings - Setting aside money
(i) Variable expenses can change due to some reasons like usage, consumption etc.
(ii) Budget is one of the best tools to manage our money.
(iii) ‘Pay yourself first’ means spending money for our present needs.
(iv) The more we save, the more money we have, to meet our goals in life.
(v) Cash management is handling of ‘money coming in’ only.
(i) True
(ii) True
(iii) False
(iv) True
(v) False
Ans: Expenses refer to the money spent on various needs and wants. They represent the outflow of money to pay for goods, services, and other financial obligations. Expenses can be categorized into fixed expenses, which do not vary, and variable expenses, which can change based on usage or consumption.
Ans: Fixed expenses are costs that remain constant regardless of usage or consumption. These are regular and predictable expenses, such as rent, mortgage payments, insurance premiums, and loan repayments. Fixed expenses do not fluctuate over time and must be paid regularly, making them easier to budget for.
Ans: Variable expenses are costs that can fluctuate based on usage or consumption. These expenses are not fixed and can change from month to month. Examples of variable expenses include utility bills, groceries, entertainment, and dining out. For instance, the electricity bill can vary depending on the amount of electricity used in a particular month.
Ans: A budget is a financial plan that outlines expected income and expenditures over a specific period. It helps individuals and households manage their money by tracking spending, identifying savings opportunities, and ensuring that financial goals are met. A budget includes both fixed and variable expenses, allowing for better financial control and planning.
Ans: Cash Management: Cash management involves handling money that comes in (income) and goes out (expenses). It includes planning, monitoring, and controlling cash flow to ensure that financial resources are used efficiently and effectively. Good cash management helps individuals and households meet their financial obligations, save for future needs, and avoid debt. One of the best tools for managing cash is a budget, which provides a clear picture of income and expenses, enabling better financial decision-making.
Budget Table for a Month's Household Income and Expenditure:
Here, the household has a total income of Rs. 60,000. Fixed expenses, which include rent, utilities, insurance, and loan repayments, total Rs. 26,000. Variable expenses, such as groceries, transportation, entertainment, and dining out, total Rs. 18,000. The household allocates Rs. 10,000 for savings and investments. The total expenses and savings amount to Rs. 54,000, leaving a surplus of Rs. 6,000 for the month. This surplus can be used for additional savings, investments, or unexpected expenses.
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