Question

Which of these best states why someone would use a budget? A. People need to keep a budget to know how much income tax to pay. B. Having a budget is the only way to get a government appropriation. C. Budgets help people keep their expenses below their income. D. Fixed expenses can be reduced by using a strict budget.


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Answer 1

Answer: C. Budgets help people keep their expenses below their income.

Explanation: The act of budgeting could be explained as a process of keeping track of one's income or revenue as well as spending or expenses over a certain period of time. This is particularly necessary in other to ensure that one maintains a reasonable spending behavior which ensures that spending does not outweigh revenue. This will ensure that such individual is safe from excessive debt. With the aid of a budget, one can avoid unnecessary financial strain on expected revenue through thorough planning of expenses and avoiding spending activities beyond one's revenue bracket.