Question

Antonio is ready to move out of his parent's house and live on his own. He found a great apartment that has all utilities included. His job as an assistant plumber requires him to have a car, but his hours are flexible enough to give him time on the weekends to have fun with his friends. What is the best way Antonio's budget can be modified to help him save enough for the $200 down payment and make the $500 monthly rental payment?
Monthly Budget
Old Budget
New Budget
Income
Wages
$1500
$1500
Expenses
Food
Cell Phone
Savings
Entertainment
Car Expenses
.
$250
$175
$200
$200
$300
.
$____
$____
$____
$____
$____
Net Income
$375
$____

a.
Antonio could keep his budget the same and hope he gets a raise at work.
b.
Antonio could reduce his monthly entertainment expenses by $100 to help pay the monthly rent. He could take $200 out of savings once for the deposit.
c.
Antonio could live at his parent’s house for one more month and save his net income. After one month of living at home, he would have enough additional money for the deposit and one year’s rent at the apartment.
d.
Antonio could reduce his monthly entertainment expenses by $75 and his food expenses by $50 to pay the monthly rent. He could take $200 out of savings once for the deposit.

Answer 1

Answer: d.

Reason: Current income = $1500; current expenses = $250 + $175 + $200 + $200 + $300 = $1125, so net = $375. If he moves out he must add $500 rent, so he'd need an extra $125/month (500 − 375 = 125). Cutting entertainment by $75 (200 → 125) and food by $50 (250 → 200) frees $125/month, making total expenses = 1500 and net = 0, so he can pay the $500 rent. The $200 down payment can come from his $200 savings. Options a, b, c do not provide the needed monthly or upfront funds.