ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Fixed expenses generally cost the same amount each month (such as rent, mortgage payments, or car payments), while variable expenses change from month to month (dining out, medical expenses, groceries, or anything you buy from a store).

Detailed explanation-2: -Businesses use fixed costs for expenses that remain constant for a specific period, such as rent or loan payments, while variable costs are for expenses that change constantly, such as taxes, labor, and operational expenses.

Detailed explanation-3: -Typically, they do not change, and you pay the same amount for these expenses every month. For example, lease agreements, mortgage payments, and car insurance generally have contracts with set payment amounts that do not vary from month to month.

Detailed explanation-4: -Variable expenses are the money you spend on food, clothing, and entertainment. The challenge to budgeting these expenses is that they are rarely exactly the same every month and they do not typically occur on the same day of each month.

Detailed explanation-5: -Variable expenses That’s where budgeting can come in handy. It can help you see what you pay over time in variable expenses and make changes as necessary. Examples of variable expenses include groceries, utilities, gas, dining out, clothing and personal care.