ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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When you budget, you should make sure all your needs are met first, then you can decide to spend on wants
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Needs are worth spending money on, but you should never spend on a want
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Needs can be very expensive, but wants are usually far less expensive so you don’t need to keep track of them
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You cannot create a budget that has both needs and wants included ____ you need them each in a separate budget
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Detailed explanation-1: -Understanding the difference between needs vs. wants will help you manage your budget and prioritize your spending. Needs are essential to live comfortably, but wants are often expenses that you can do without.
Detailed explanation-2: -Prioritizing bills and expenses in order of importance lets you meet basic needs, protect your credit, and lower your financial stress. This, in turn, allows you to focus on finding ways to cut costs or increase your income so you can pay all of your bills each month and even start saving for the future.
Detailed explanation-3: -Why is it important to distinguish between wants and needs when defining the problem in a buying decision? The wants is not really important as to so if the product does what is needed and that can throw off consumers because they want what they want. How do your values affect your use of money?
Detailed explanation-4: -A need is something necessary to live and function. A want is something that can improve your quality of life. Using these criteria, a need includes food, clothing, shelter and medical care, while wants include everything else.