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      Question

      Zero-Based Budgeting (ZBB)

      requires:
      A Adjusting the previous year's budget for inflation Correct Answer Incorrect Answer
      B Justifying every rupee of expenditure from scratch Correct Answer Incorrect Answer
      C Preparing a budget with zero deficit Correct Answer Incorrect Answer
      D Allocating resources based on historical trends Correct Answer Incorrect Answer
      E Focusing only on capital expenditures Correct Answer Incorrect Answer

      Solution

      Unlike traditional budgeting which starts with the previous year's budget as a base, Zero-Based Budgeting requires managers to justify all expenditures for each new period, starting from a "zero base." Every function is analyzed for its needs and costs.

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