Budgetary system

Dear Tr.Moffat,

Q. The following statements have been made about budgetary systems in the performance hierarchy:
1) Developing new products in response the changes in technology is a budgeting activity that would fall within operational planning and control.
2) Budgetary systems at strategic planning levels look at the business as a whole and define resource requirements.
Which of the above statement(s) is/are true?

The Answers is Number 2 only

My question is what is the reason of false for number 1?

Thanks.

May.