Alex has decided that she wants to save money to buy her first car. She wants to save this money over the course of the next two
years. Which action would be the best way for Alex to change her budget to work toward a long–term financial goal? Set aside less for fixed expenses and create a budget item for savings. Set aside less for discretionary spending and create a budget item for savings. Set aside less for savings and put those funds toward flexible expenses. Set aside less for savings and put those funds into discretionary spending. ANSWER, B.
The correct answer is B. Alex has to cut the expenses and increase savings, so answers C and D are obviously wrong as these answers increase the expenses. Answer A is also incorrect as fixed expenses are those necessary for the normal development of the person's life, such as food, housing expenses, taxes, etc. So the expenditure cut should be made in extraordinary expenses, which are discretionary at the will of Alex, for example, leisure expenses, or unnecesary purchases. So the correct answer is B.
