Question

Alexa has finished her culinary training program and is now working full-time as a chef in a hotel resort restaurant. She has tripled her salary from when she was working part-time to pay her expenses through school. How should this increased income affect her budget? Make comparisons with her previous budget and her current budget.
Monthly Budget
Previous Budget
Current Budget
Income
Wages
$800
$2400
Expenses
Rent
Utilities
Groceries
Savings
Bus Pass
$300
$60
$200
$100
$30
$300
$60
$250
$150
$30
Net Income
$110
$1610

a.
Alexa is earning quite a bit more money and her expenses reflect the change in income.
b.
Alexa is earning quite a bit more money than she was previously. She has worked hard and deserves to spend a lot of money on herself.
c.
Alexa is earning quite a bit more money than she was previously. This would be a good time for her to re-evaluate her budget. Part of the extra money she is making could be put in her savings account.
d.
Her increased income should have no effect on her financial decisions.



Please select the best answer from the choices provided


A
B
C
D

Answer 1

C

She should re-evaluate her budget and allocate part of the extra income (for example, increasing savings or paying down debt) rather than simply increasing spending.