International Baccalaureate (IB) Practice Exam

Disable ads (and more) with a membership for a one time $2.99 payment

Study International Baccalaureate Exams with tailored multiple choice quizzes and flashcards. Gain confidence with explanations and hints for every question. Ace your exams!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

What is an important lesson regarding budgeting?

Expenses should always equal income
Setting a specific budget is unnecessary
A budget must be flexible
Regular income is needed to create a budget

The correct answer is: A budget must be flexible

A critical lesson in budgeting is the necessity for a budget to be flexible. This flexibility allows individuals and organizations to adapt to changes in their financial situations and unexpected events. Life can be unpredictable, and expenses may arise that were not initially accounted for in a rigid budget. By having a flexible budget, individuals can adjust their spending categories, allocate funds where they are most needed, and make informed decisions about their finances without feeling constrained. Flexibility also helps in accommodating variations in income or costs, making it easier to maintain financial health during fluctuating circumstances. For example, if an emergency arises or there is a sudden drop in income, a flexible budget can help prioritize essential expenditures while managing non-essential items accordingly. Other options do not encompass the same level of practicality. Matching expenses with income suggests an inflexible approach, disregarding variations. Claiming that a specific budget is unnecessary undermines the importance of financial planning and monitoring. While regular income can assist in creating a budget, it is not a prerequisite for establishing one; many can benefit from budgeting regardless of income stability.