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In relation to household budgeting, explain essential expenditure and discretionary expenditure - Leaving Cert Home Economics - Question 12 - 2013
Question 12
In relation to household budgeting, explain essential expenditure and discretionary expenditure. Give one example of each. Essential expenditure ___________________... show full transcript
Worked Solution & Example Answer:In relation to household budgeting, explain essential expenditure and discretionary expenditure - Leaving Cert Home Economics - Question 12 - 2013
Step 1
Essential expenditure
Answer
Essential expenditure refers to the money that must be spent to manage family life, including spending on necessities. This type of expenditure can be categorized as either fixed, where the same amount is required at regular intervals, or irregular, where the amount may vary, but the spending remains necessary. Common examples include bills for utilities like electricity, water, rent, or mortgage payments.
Step 2
Step 3
Discretionary expenditure
Answer
Discretionary expenditure involves spending on non-essential items or services that enhance quality of life. This occurs when all essential expenditures and savings have been allocated. Discretionary spending is more flexible and can vary widely from month to month.
Step 4