Fixed and Variable Expenses

Front

What is the definition of fixed expenses?

Back

Fixed expenses are costs that remain constant over a period of time, such as rent or a gym membership fee.

Front

What is the definition of variable expenses?

Back

Variable expenses are costs that can change from month to month, such as groceries or gas.

Front

Give an example of a fixed expense.

Back

A gym membership fee is an example of a fixed expense.

Front

Give an example of a variable expense.

Back

Raw material costs in a business are an example of a variable expense.

Front

Are after school snacks considered fixed or variable expenses?

Back

After school snacks are considered variable expenses.

Front

What is the main difference between fixed and variable expenses?

Back

The main difference is that fixed expenses remain the same over time, while variable expenses fluctuate.

Front

How can understanding fixed and variable expenses help in budgeting?

Back

Understanding these expenses helps individuals create a more accurate budget by distinguishing between necessary fixed costs and flexible variable costs.

Front

Is Sarah's weekly gas expense of $50 a fixed or variable expense?

Back

Sarah's weekly gas expense of $50 is a variable expense.

Front

What are some common examples of fixed expenses?

Back

Common examples include mortgage or rent payments, insurance premiums, and subscription services.

Front

What are some common examples of variable expenses?

Back

Common examples include dining out, entertainment, and utility bills that vary with usage.