Question

Jacob is ready to move into his own apartment. He has a great job earning $1680 per month. What is the best way Jacob’s budget can be modified to help him make the $600 monthly rental payment?
Monthly Budget
Old Budget
New Budget
Income
Wages

$1680

$1680
Expenses
Rent
Food
Clothes
Savings
Recreation
Car Expenses

$0
$200
$75
$700
$400
$300

$____
$____
$____
$____
$____
Net Income
$5
$____
a.
Jacob could spend less on food and clothes to make his $600 monthly rental payment.
b.
Jacob could spend less on recreation and reduce the amount that he is saving to make his $600 monthly rental payment.
c.
No modifications to his budget would be necessary as long as he takes on a part-time job on the weekends to increase his income and help pay his rent.
d.
Jacob could spend less on food and recreation to make his $600 monthly rental payment.


Please select the best answer from the choices provided

A
B
C
D

Answer 1

Answer: D

Explanation: Jacob’s current expenses total $1,675 (200 + 75 + 700 + 400 + 300), leaving him $5 from $1,680 income. To add a $600 rent he must cut $595 from his expenses.
- (a) Food + clothes = $275 (not enough).
- (b) Recreation + savings = $1,100 (would work but cuts savings).
- (d) Food + recreation = $600 (just enough to cover the $595 reduction needed without touching savings).
- (c) Suggesting a part-time job is not a budget modification and isn’t the best immediate solution.

So the best choice is D.