ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The partial budget has four categorical parts: additional income, reduced costs, reduced income and additional costs. Additional income. A proposed change may bring additional income from an enterprise if it is added or increased in size or if output is increased for the particular enterprise.

Detailed explanation-2: -A partial budget only includes resources that will be changed. It does not consider the resources in the business that are left unchanged. Only the change under consideration is evaluated for its ability to increase or decrease income in the farm business.

Detailed explanation-3: -What Is Partial Budgeting? Partial budgeting is a planning and decision-making framework used to compare the costs and benefits of alternatives faced by a farm business. It focuses only on the changes in income and expenses that would result from implementing a specific alternative.

Detailed explanation-4: -The first limitation of partial budgeting is that it is restricted to evaluating only two alternatives. The second limitation is that the results obtained from a partial budget are only estimates, and are only as good as the original data that is entered.