waecE-LEARNING
Economics Paper 2, May/June 2012  
Questions: 1 2 3 4 5 6 7 8 9 10 11 12 Main
General Comments
Weakness/Remedies
Strength




QUESTION 2



The tables below show the expected revenues and projected expenditures from the
budget of a hypothetical country in 1998.  Use the information in the tables to answer the questions that follow:

EXPECTED REVENUE

ITEM

                                  
                          AMOUNT
                          ($ millions)

Rents, royalties and profits
Company income tax
Customs and excise duties
Personal income tax
Fees and specific charges
Value added tax

                                75.00
                              150.00
                              300.20
                                 80.00
                                 60.80
                               100.00

  1. Rents, Royalties and Profits                                          75.00
    Fees and specific charges                                               60.80
                                                                                        Total                            135.80
    (b)        (i)         Capital expenditure

                                        Building of schools and hospitals                               200.00
                                        Road construction                                                       180.90
                                                                                        Total                            380.90

                            (ii)        Recurrent expenditure

                                        General administration                                                220.10
                                        Maintenance of foreign missions                                   50.00
                                        Transfer payments                                                          65.00
                                                                                        Total                            335.10

    (c)        Total revenue                                      $766.00 million
                            Total expenditure                                $716.00 million
                            Surplus                                                $766 - $716 = $50 million

                            The budget is a surplus because total revenue exceeds the total expenditure.?


 

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