What type of cost is categorized as fixed, like a mortgage?

The correct type of cost that is categorized as fixed, akin to a mortgage, is personal fixed cost. Fixed costs are expenses that do not change with the level of goods or services produced by a business or, in this case, personal expenses. A mortgage is a classic example of a fixed cost because it involves a set payment amount due regularly, regardless of personal income fluctuations or unexpected expenses.

Personal fixed costs can include other expenses as well, such as rent, insurance premiums, and property taxes. These costs are generally predictable and stable over time, making them essential for budgeting and financial planning. In contrast, other options like variable costs can change with consumption levels, personal discretionary costs can vary greatly based on choices, and emergency fund costs are not regular fixed expenses but rather savings set aside for unforeseen situations. This distinction emphasizes the regularity and predictability of personal fixed costs, highlighting their important role in financial management.