Zero-base budgeting:

Question

Quizplus · Accepted Answer

Zero-base budgeting means that an agency does not automatically receive its previous year's base budget. Instead, each program or activity must be justified in new budget requests, starting from a zero base. This approach requires a thorough analysis of each program's goals and benefits, and emphasizes the need to prioritize and allocate resources based on performance outcomes. It was first used in the private sector and later adopted by some government agencies as a method of improving efficiency and accountability. Option A is incorrect because "sunseting" means that a law or program will automatically expire at a certain time, rather than being subject to zero-base budgeting. Option C is incorrect because zero-base budgeting is a legal and valid method of budgeting, and has been used by many organizations and governments.

Zero-Base Budgeting