Unit 1 Personal Finance 2. Decide whether the following statements are True or False. T F
(a) Buying food and groceries is a form of fixed expenditure. q q (b) Paying monthly rent for a house is a form of discretionary expenditure.
q q
(c) Purchasing a new car is an example of capital expenditure. q q (d) Going to the cinema is a form of discretionary expenditure. q q (e) Petrol for the family car is an example of irregular expenditure.
(f) Electricity is provided free to all households. (g) Pocket money is an example of discretionary income.
q q q q q q
3. Jane has e50 to spend. She can choose to buy new clothes or get her hair cut and coloured, but not both. (a) If Jane decides to buy new clothes: What is the financial cost of her decision? What is the opportunity cost of her decision? (b) If Jane decides to get her hair cut and coloured: What is the financial cost of her decision? What is the opportunity cost of her decision?
4. Mary can spend e1,000 on a new computer or on getting her car repaired. (a) If Mary buys the computer: What is the financial cost of her decision? What is the opportunity cost of her decision? (b) If Mary gets her car repaired: What is the financial cost of her decision? What is the opportunity cost of her decision?
