The calculation of power and noise levels between transmitter and receiver (uplink or downlink), taking account of all gain and loss factors, to yield operating values of CII and C/NR, margin above threshold, and ultimate SINR or BER.

A link budget is the accounting of all of the gains and losses from the transmitter, through the medium (free space, cable, waveguide, fiber, etc.) to the receiver in a telecommunication system. It takes into account the attenuation of the transmitted signal due to propagation, as well as the loss, or gain, due to the antenna. Random attenuations such as fading are not taken into account in link budget calculations with the assumption that fading will be handled with diversity techniques.