International Baccalaureate (IB) Practice Exam

What type of expense are car repairs classified as?

1. Fixed expense

2. Variable expense

3. Discretionary expense

4. Intermittent expense

The correct answer is: Intermittent expense

Car repairs are classified as intermittent expenses. This is because they do not occur regularly every month but rather arise based on specific needs or circumstances related to the vehicle's maintenance. These expenses can be unpredictable and vary in amount from one occasion to another, depending on the nature of the repairs needed. In contrast, fixed expenses are costs that remain constant over time, such as rent or mortgage payments. Variable expenses fluctuate with usage or consumption, such as groceries or utility bills, but car repairs do not fall into this category as they are not incurred on a consistent basis. Discretionary expenses refer to non-essential spending, such as entertainment or dining out, which differs from car repairs that are often necessary for vehicle safety and functionality. Thus, classifying car repairs as intermittent expenses accurately reflects their unpredictable and occasional nature.