Final answer:
Discretionary income is the amount of money left for an individual or household to spend, invest, or save after paying taxes and essential expenses.
Step-by-step explanation:
The amount of income left after paying taxes and making essential purchases is known as B. discretionary income. This is the money a person or household can use to invest, save, or spend on non-essential items and services once all necessary expenses have been paid, such as mortgage/rent, car payment, utilities, and taxes. After paying for these essentials, one must strategically decide how to use their disposable income, with a portion potentially going towards increasing personal savings or spending on consumption now and saving for future consumption.