Math of Finance Chapter 1 Review

Vocabulary

100

Things you must have, such as food are called...

Needs

200

Any expenses that are not considered essential to the household or business are ____________ expenses

discretionary

300

Things you would like, but can do without are called...

Wants

400

Expenses that are the same from week to week are called...(2 words)

Fixed Expenses

500

Expenses that change from week to week or month to month are called...(2 words)

Variable Expenses

Needs & Wants

100

Would eating out be considered a need or a want?

Eating out would be a want.

200

Would toothpaste be considered a need or want?

Toothpaste would be considered a want.

300

Would rent be considered a need or a want?

Rent would be considered a need.

400

Would groceries be considered a need or a want?

Groceries are a need.

500

Would nail polish be considered a need or a want?

Nail polish would be a want.

Skills Practice

100

You spend a gift card on a strawberry smoothie instead of a banana smoothie. Your opportunity cost is

a banana smoothie.

300

• A student spends three hours and $20 at the movies the night before an exam. The opportunity cost is (list 2 things)

time spent studying and that money to spend on something else.

Savings

100

True or False. Your car payment is an example of a variable expense?

False

200

3 example of Fixed expenses are.......

Internet bill

Rent

Car payment

300

You want a $300 couch as soon as possible. How much would you have to save every month for 5 months to afford the couch?

You would have to save $60 each month.

400

Tracy's income is $1,194.83 a month. She has $1,160.81 in expenses each month. How much does Tracy have left for savings?

Tracy has $34.02 left for savings.

500

If your income were $998.00, how much more would you need to pay $1,160.81 in expenses?

I would need $162.81 more.

Fixed & Variable Expenses

100

Would rent be considered a fixed or variable expense?

Rent would be a fixed expense.

200

Would clothing be considered a fixed or variable expense?

Clothing would be considered a variable expense.

300

Would your car payment be considered a fixed or variable expense?

A car payment would be considered a fixed expense.

400

Would your car insurance be considered a fixed or variable expense?

Your car insurance would be a fixed expense.

500

Would electricity be considered a variable or fixed expense?

Electricity is a variable expense. The more you use, the more you pay.