Saving up for purchases | Economics homework help

5.4 Saving Up for Purchases

Personal Finance Portfolio: Part 4

Note: This is one part of a Personal Finance Portfolio in the course that we will be working on throughout the semester. The completed portfolio will count 10% of your final grade. 

Activity Goal   

This Personal Finance Activity will help you see how long it might take on minimum wage to save up for a large purchase. Understanding how to save and live on a budget will help you plan for large purchases in your future.

Directions

Read the following paragraph about the hypothetical budget you could be living on if you were making minimum wage. Calculate the totals for your monthly budget (what would you fill in the third column below) and then answer the five questions that follow.

You are living on your own, sharing rent with a roommate, trying to save up for college, and working for minimum wage ($7.25) at a fast food restaurant. You work 40 hours per week and take a bus to and from work five days a week. Along with saving for tuition, you are also trying to save enough to have 4 months’ rent in your account, a new car so you don’t have to take the bus and a vacation to Cancún with some of your friends. The amounts for Rent and Utilities in the first two rows are your half of the total for rent and utilities; your roommate pays the other half of both expenses.

Monthly BudgetItemCostMonthly TotalRent$260Utilities (cable, Internet, water, and electricityCable & Internet: $30, water: $20, electricity: $40Groceries$50 per weekEntertainment$20 per weekPublic transportation$1.50 per bus rideClothing$50Cell phone$45

Questions

  1. Approximately how much is your gross salary per month? Because you would be in the lowest tax bracket, you would be taxed at approximately 15 percent. How much would you actually take home every two-week pay period? How much would you take home each month?
  2. How much are your total monthly expenses? What other costs may you incur that are not included in your monthly budget? How much disposable income do you have each month?
  3. How long would it take you to save 4 months’ rent?

   

  1. You found an old, used car that you want to buy so you can stop taking the bus. It costs $2,000. How long would it take you to save up for the car?
  2. Flights to Cancún are $380 round trip. The hotel where your friends are staying will cost $75 a night and you will be staying 3 nights. What would the total cost of your trip be? Be realistic in including additional expenses (e.g. food and entertainment.) How long would it take to save up for the vacation?
  3. Given the above scenarios, which major expense would you save for first? Explain your answer, providing at least three reasons. 

Rubric

The rubric below will be used to grade your project.

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more