HISET Social Studies Practice

What is a flexible expense?

1. A cost that cannot be altered

2. An expense that typically stays the same from month to month

3. An expense that can be adjusted or changed

4. An expense necessary for basic living needs

The correct answer is: An expense that can be adjusted or changed

A flexible expense is defined as an expense that can be adjusted or changed based on an individual's financial situation or personal choices. This type of expense allows for variations in spending and can be reduced or increased as necessary. For example, costs related to entertainment, dining out, or purchasing non-essential items fall into this category, as they can be modified depending on one’s budget or financial goals. In contrast, those expenses classified as fixed or dependent expenses do not allow for such flexibility. Fixed expenses, such as rent or mortgage payments, generally remain constant every month, making them inflexible. Additionally, necessary living costs, which are essential for survival, also tend to be inflexible because they represent fundamental needs that must be met regardless of other financial circumstances. Thus, the proper understanding of flexible expenses emphasizes their adaptable nature in the broader context of personal finance management.