Final answer:
The correct answer is (a) zero-based budgeting, a budgeting method where all expenses must be justified for each new period, starting from zero without reference to previous budgets.
Step-by-step explanation:
When a manager is asked to justify a new budget proposal on the basis of projected activities rather than as an incremental adjustment to the prior year's budget, this is an example of zero-based budgeting. Zero-based budgeting (ZBB) is a budgeting method where all expenses must be justified for each new period, starting from a "zero base", without reference to previous budgets. This approach involves preparing the budget from scratch as if the budget is being made for the first time. This can be a more time-consuming process, but it can lead to more accurate and efficient allocation of resources, as it requires managers to justify all their expenses, as opposed to only explaining the expenses that exceed those of the previous period.