Question

Assertion (A): A budget allows us to foresee if we have enough money to fulfil our needs.

Reason (R): Budget acts as an intelligent guide to spending.

Options

• A is true but R is false.

• A is false but R is true.

• Both A and R are true and R is the correct explanation of A.

• Both A and R are true and R is not the correct explanation of A.

Answer 1

Both A and R are true and R is the correct explanation of A.

Explanation: 

A budget projects expected income and expenses so you can tell whether you’ll have enough money to meet needs; by doing this it guides how you should allocate and prioritise spending,i.e., it “acts as an intelligent guide to spending,” which is why you can foresee sufficiency.