A budgeting approach in which every activity must be justified afresh as if it were being undertaken for the first time, without reference to the previous year's figures, is called:

Correct answer: C) Zero-based budgeting

Explanation

Zero-based budgeting requires each manager to justify the entire budget for each activity from scratch, ranking decision packages by priority. Incremental budgeting takes last year's figures as a base and adjusts them; a flexible budget changes with activity level; a rolling budget is continuously extended by adding a new period as one expires.