Identify an example of a ‘fixed’ cost’ and a ‘variable’ cost from the simulation and explain why you
believe they are a variable cost or a fixed cost.
b) Explain why it is important for you to be able to recognise the difference between fixed costs and
variable costs. Use an example from the spreadsheet to help illustrate your answer

City and province where you will live : Hanoi - Field your job will be in: IT - Pay rate per hour: 50,000 VND - Working hours per week: 30 Hours - Rent amount and whether utilities are included or not: Not included - Total cost for utilities (water, electric, gas, phone, internet, TV): 1,500,000 VND - Grocery store where you will shop and estimated cost per week for food: Grocery store A - Whether you will pack your lunch or eat out daily and estimated cost per week for lunches: Pack lunch - Estimated amount you plan to spend on clothing each month: 500,000 VND - Estimated cost per month for laundry: 1,000,000 VND - Mode of transportation to work (bus, taxi, or personal vehicle) and estimated cost per day and per month for transportation: Bus , 8,000,000 VND - Gas, insurance, and maintenance cost per month if using a personal vehicle: 500,000 VND

- Gross income per week: 50,000 VND/hour x 30 hours = 1,500,000 VND/week - Taxes per week: 10% x 1,500,000 VND = 150,000 VND/week - Net income per week: 1,500,000 VND - 150,000 VND = 1,350,000 VND/week - Monthly rent: 3,000,000 VND/month ÷ 4 weeks = 750,000 VND/week - Total expenses per week (excluding food and clothing):

750,000 VND (rent) + 800,000 VND (transportation) + 1,000,000 VND (utilities) + 500,000 VND (laundry) = 3,050,000 VND/week