Question

The disposable income minus the money needed for necessities to sustain life, such as minimal housing, minimal food, and minimal clothing is:

1) discretionary income
2) comprehensive income
3) aggregate income
4) passive income
5) basic income

Answer 1

Disposable income is the amount of money an individual or household has after deducting the money needed for basic necessities. The correct answer is discretionary income (1).

Step-by-step explanation:

Disposable income refers to the amount of money an individual or household has available for spending, saving, or investing after taxes have been paid and transfers from the government have been received. It is the money that remains after deducting the money needed for necessities like housing, food, and clothing.

For example, if a person's monthly income is $3,000 and they spend $2,000 on basic necessities, their disposable income would be $1,000.

The correct answer to your question is 1) discretionary income.