Question

1. To calculate discretionary money, you ____?

A. calculate the difference between your gross pay and net income
B. calculate the difference between your net income and fixed expenses
C. calculate the difference between your gross pay and fixed expenses
D. calculate the sum of your net income and fixed expenses

Answer 1

option B

Explanation:

To calculate discretionary money, you calculate the difference between your net income and fixed expenses.

Discretionary money is the left with an individual after paying taxes, personal expenses such food, shelter and clothing, etc. The left money can be used for saving, investing, etc. it purely depends upon individual discretion.

hence Option B is correct