The principal negative consequence of incremental budgeting is that money may be allocated to a unit in the future merely because the unit had been allocated money in the past.

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Incremental budgeting assumes that past budget allocations are a reliable indicator of future needs, which may not always be the case. This approach can result in funds being allocated to units even if their needs have changed or if they are no longer a priority. As a result, incremental budgeting can lead to inefficient use of resources and missed opportunities for reallocating resources to areas with greater needs.

The Principal Negative Consequence of Incremental Budgeting Is That Money