Which would be most helpful when considering a large expenditure that might require repeating?
Steps in Solving Personal Financial Challenges
2. Assessing risks and returns
3. Setting short- and long-term goals
4. Assessing needs and wants
Which of these is the correct order of these steps?
a) 2, 1, 3, 4
b) 1, 2, 3, 4
c) 4, 1, 2, 3
d) 4, 2, 3, 1
Final answer:
The correct order of the steps for considering a large expenditure that might require repeating is 1, 2, 3, 4.
Explanation:
The correct order of the steps for considering a large expenditure that might require repeating is b) 1, 2, 3, 4.
1. Considering opportunity costs: This involves evaluating the potential benefits and drawbacks of different spending options.
2. Assessing risks and returns: This step involves analyzing the potential risks and rewards associated with the expenditure.
3. Setting short- and long-term goals: This step involves defining the specific financial goals that the expenditure should align with.
4. Assessing needs and wants: This step involves distinguishing between essential needs and discretionary wants, and considering which ones align with the financial goals.
Question: Which of the four steps is the correct order for considering a large expenditure that might require repeating? Answer: The correct order is 1, 2, 3, 4 as outlined in the explanation above.