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4 Examples of a Static Budget

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A static budget is a budget that doesn't change based on business volumes. This can be seen as the opposite of a flexible budget that increases or decreases based on results such as revenue and business demands such as the volume of customer inquiries. The following are illustrative examples of a static budget.


Operations that are somewhat detached from business volumes such as human resources and accounting. For example, you may need 23 employees in human resources. Work volumes may not increase much based on revenue growth in a particular year.

Capital Budget

Capital investments may be insensitive to your business volumes. For example, a firm decides to replace all its computers that are older than 5 years and calculates a static budget of $2 million for this effort.


A factory budgets for running current facilities for three shifts a day on a 330 day business calendar. The shifts each have 8 employees who are given regular hours with no possibility of overtime. Sales and operations planning view the factory as a fixed resource that can't be scaled up and down. The factory has a static budget based on predictable costs for materials, labor, power and machines.


A space program is given a static budget of $18 million a year and it sets its objectives based on this constraint.
Overview: Static Budget
A budget that doesn't change based on business volumes.
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