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In this video, the tutorial explains how to create a budget for a research proposal using Microsoft Word, emphasizing its simplicity compared to Excel. Key steps include starting with a clear heading and indicating the funding source, such as the Faculty of Health Sciences Endowment Fund or personal financing. The budget table should include columns for items, explanations, and costs. In the explanation column, provide details on each budget item to ensure clarity, especially for readers who may overlook the methods section that mentions the role of a research assistant. This approach enhances understanding and addresses potential questions about budget items.