Which Budgeting Method Sets the Budget by Examining What Competitors

question 75

Multiple Choice

Which budgeting method sets the budget by examining what competitors are doing? 

• A) percentage-of-sales method 
• B) objective-and-task method 
• C) competitive parity method 
• D) affordability method 
• E) comparative method

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Definitions:

Natural Monopolies

Natural monopolies occur in industries where the costs of production are lowest when only one firm provides the product or service, often due to high infrastructure costs making competition impractical.

Too Much Labor

A situation where there is an excess supply of labor in the market, leading to unemployment or underemployment.

Sherman Act

A landmark federal statute in the field of United States antitrust law passed in 1890 to prohibit monopolies and restrict business practices that reduce market competition.

Monopolization

The process or state by which a single company gains exclusive control over a market, eliminating competition, and often leading to higher prices and reduced quality for consumers.