ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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It’s a method of budgeting that uses envelopes labeled with specific budget categories for your cash.
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It’s a systematic approach to budgeting with a digital app that organizes categories based on qualitative amounts.
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It’s a way to budget that involves putting a credit card in each envelope to use for that category.
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It’s a system that involves writing your entire budget on an envelope.
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Detailed explanation-1: -The envelope system is a way to track exactly how much money you have in each budget category for the month by keeping your cash tucked away in envelopes. At the end of the month, you can see how much cash is left by taking a quick peek in your envelope.
Detailed explanation-2: -The idea is to split up your money according to how much you want to spend in each category-and then only let yourself spend until the cash in each envelope is gone. Envelope budgeting works best for variable expenses, like groceries and dining out, which change slightly every month depending on your spending habits.
Detailed explanation-3: -You can use the envelope system for any expenses, but the most common are dining out, entertainment, household goods, clothing, gas, and personal expenses.
Detailed explanation-4: -What Is an Envelope? Envelopes are technical indicators that are typically plotted over a price chart with upper and lower bounds. The most common example of an envelope is a moving average envelope, which is created using two moving averages that define upper and lower price range levels.
Detailed explanation-5: -Cash stuffing is none other than the envelope system with Gen Z flair. As explained by money guru Dave Ramsey, the envelope system is a budgeting tool that has you allocating cash into different buckets (by way of designated envelopes) as a strategy to control monthly spending.