What is a characteristic of incremental budgeting?

Incremental budgeting is characterized by its emphasis on changes to current budget levels, making this the correct choice. In this approach, the prior budget serves as a base, and adjustments are made for the upcoming period, typically through small increments. This means that budgeters examine the existing allocations and modify them slightly, often considering factors such as inflation, minor adjustments in program funding, or anticipated changes in expenditures.

The incremental approach is practical for organizations accustomed to routine operations, as it allows for continuity and stability in funding. It does not require a comprehensive review of all expenses or a reevaluation of the entire budget structure, but rather focuses on adjustments, which is why it is favored in many traditional budgeting environments.

Long-term planning, total program costs, and eliminating unnecessary expenditures represent different budgeting philosophies or strategies. While some may be components of other budgeting methods, they do not encapsulate the essence of incremental budgeting, which is primarily about making relatively minor adjustments based on the existing financial baseline.