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What is the difference between disposable income and discretionary income?
Wiki User
∙ 13y ago
Formulas are: Disposable income = consumption expenditure + savings - support of others; Discretionary income = Gross income - taxes - necessities. Although denotatively wrong, disposable income is commonly used to denote discretionary income.
Wiki User
∙ 13y ago
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What is the difference between a consumer's disposable and discretionary income?
Disposable income is the money a consumer has left after paying taxes to use for necesities such as food housing, clothing, and transportation. Discretionary income is the money that remains after paying for taxes and necessities and is used for luxury items.
What is the difference between personal income and disposable income?
a
How is discretionary income calculated?
Discretionary income is calculated by taking your gross income minus your expenses and what you are left with is discretionary income. Most Americans do not have a large amount of discretionary income.
Why marketers are interested in discretionary income?
Because discretionary Income = The money people have left over once they have paid for all of their basic requirements (Food, Clothing, Shelter). You could also call it Disposable Income because it is money you have (hopefully) that you can spend on whatever you want. If people do not have very much discretionary income then they cant buy all kinds of useless stuff that marketers are trying to sell them. This would limit the potential demand for a good or service.
How do households spend most of their discretionary income?
Households spend most of their discretionary income on consumption.
What is the between disposable income and discretionary income?
Formulas are: Disposable income = consumption expenditure + savings - support of others; Discretionary income = Gross income - taxes - necessities. Although denotatively wrong, disposable income is commonly used to denote discretionary income.
What is the different between disposable income and discretionary income?
Formulas are: Disposable income = consumption expenditure + savings - support of others; Discretionary income = Gross income - taxes - necessities. Although denotatively wrong, disposable income is commonly used to denote discretionary income.
What is the difference between a consumer's disposable and discretionary income?
Disposable income is the money a consumer has left after paying taxes to use for necesities such as food housing, clothing, and transportation. Discretionary income is the money that remains after paying for taxes and necessities and is used for luxury items.
What is the different disposable income and discretionary income?
Formulas are: Disposable income = consumption expenditure + savings - support of others; Discretionary income = Gross income - taxes - necessities. Although denotatively wrong, disposable income is commonly used to denote discretionary income.
Would personal income disposable income or discretionary income be of the greatest interest to marketers?
Discretionary income, not personal income or disposable income, would be the greatest interest to marketers.
What is the difference between personal income and disposable income?
a
Money left over after the bills are paid is referred to as what?
discretionary income.
How is discretionary income calculated?
Discretionary income is calculated by taking your gross income minus your expenses and what you are left with is discretionary income. Most Americans do not have a large amount of discretionary income.
What discretionary income?
Discretionary income is disposable income (after-tax income), minus all payments that are necessary to meet current bills. It is total personal income after minus taxes and minimal survival expenses (such as food, medicine, rent or mortgage, utilities, insurance, transportation, property maintenance, child support, etc.) to maintain a certain standard of living. It is the amount of an individual's income available for spending after the essentials have been taken care of: Discretionary income = gross income – taxes – all compelled payments (bills)
What percentage of household income is disposable income?
This will vary from country to country, and from region to region. It will vary yearly and throughout the year, and will be different for different social and financial classes.Strictly speaking, disposable income means:Gross income less tax, the balance all being 'disposable'.However, most people are more interested in what is known as discretionary income, which is:Gross Income less Taxes less Necessities such as basic housing costs, transport, food etc. The residue is money that can be saved or spent on non-essentials.To confuse matters, the term 'disposable income' is often used when 'discretionary' income is actually meant.Governments and economists collect a lot of data on this type of information, and much of it is accessible to the public. The Media and Press are also very interested in giving wide publicity to changes in disposable income.For more information, see Related links below this box.
Why marketers are interested in discretionary income?
Because discretionary Income = The money people have left over once they have paid for all of their basic requirements (Food, Clothing, Shelter). You could also call it Disposable Income because it is money you have (hopefully) that you can spend on whatever you want. If people do not have very much discretionary income then they cant buy all kinds of useless stuff that marketers are trying to sell them. This would limit the potential demand for a good or service.
How do households spend most of their discretionary income?
Households spend most of their discretionary income on consumption.
