Question 3 - MCQ Questions (1 Mark) - Chapter 2 Class 6 Economics - Needs and Wants - Economics

What is the name of the plan that lists how much money a person has and all the needs and wants that cost money?

A. Budget

B. Balance

C. Income 

D. Expense

Answer:

Answer by Student

The correct answer is (A) Budget

Detailed Explanation by Teachoo

Let’s check all the options

• Option (A) Budget - A budget is the name of the plan that lists how much money a person has and all the needs and wants that cost money. A budget helps a person to manage their money wisely and to achieve their financial goals. A budget usually has two main components: income and expenses. So, this is correct .
  
  
• Option (B) Balance - A balance is the name of the difference between income and expenses. A balance can be positive or negative. A positive balance means that a person has more income than expenses, which means they can save or invest some money. A negative balance means that a person has more expenses than income, which means they have to borrow or cut some costs. So, this is incorrect .
  
  
• Option (C) Income - Income is the name of the money that a person earns o r receives from different sources. Income can come from various sources such as salary, wages, tips, interest, dividends, gifts, etc. Income is one of the main components of a budget, but it is not the name of the plan itself. So, this is incorrect .
  
  
• Option (D) Expense - Expense is the name of the money that a person spends on different things such as food, rent, bills, entertainment, etc. Expense can be divided into two categories: fixed and variable. Fixed expenses are the ones that do not change much from month to month, such as rent or mortgage. Variable expenses are the ones that can change depending on the situation, such as groceries or gas. Expense is one of the main components of a budget, but it is not the name of the plan itself. So, this is incorrect .

Thus, option (A) is correct