A further benefit from using the decibel scale becomes apparent when dealing with what is known as the link budget. Using decibels, a power budget on a radio link becomes as straightforward as a simple financial budget. Transmit power and gains can be thought of as equivalent to income, with losses and required margins being equivalent to expenditure.

For example, suppose that we transmit with a power of 30 dBm (1 watt). There are feeder losses, antenna gains, free-space loss, absorption loss, fading margin etc. The link budget is really a method of organising these parameters so as to make the calculation of the received signal level (under conditions of maximum fade, if the fade margin is considered) as straightforward as possible. The received signal level should be sufficient to deliver an acceptably low bit error ratio. Table A4.1 gives an example of such a link budget.