What does a surplus indicate in Ted's financial situation?

A surplus in Ted's financial situation indicates that he has extra income after covering his expenses. This means that after Ted has accounted for all his necessary spending, he has remaining funds that could be used for savings, investments, or other financial objectives.

Recognizing a surplus is a positive sign of financial health, as it suggests that Ted is living within his means and is able to set aside additional resources for future needs or goals. Maintaining a surplus is crucial in effective financial management, as it provides flexibility and security.

In contrast, the other options highlight negative financial scenarios: expenses exceeding income suggests a deficit, declining assets point to poor asset management or market conditions, and losing value in investments signifies that Ted's investment portfolio is not performing well. A surplus is a beneficial situation that empowers Ted to strengthen his financial position.