Economics Paper 2, WASSCE (SC), 2017

Question 1

The following data shows the budget of a hypothetical country in 2006. Study the data and answer the questions that follow:



Revenue

[$ millions]

Company tax
Workers’ income tax
Excise duties
Taxes on exports
Value added tax
Import duties
Non-tax revenue

240
160
80
100
150
90
40

Expenditure

[$ millions]

Construction of roads
Building of school
Payment of workers’ salaries
Government administration
Maintenance of health facilities
Extension of electricity to rural areas
Maintenance of official vehicles

100
120
150
200
220
180
70


(a)  How much revenue was realized from:
    (i)  direct taxes;
    (ii)  indirect taxes?

(b)  Calculate the total:
    (i)  recurrent expenditure;
    (ii)  capital expenditure.

(c)   What percentage of total revenue was collected as indirect tax?

(d)  State two examples of non-tax revenue.

(e)  What was the budget surplus or deficit? Explain your answer.

 

This is one of the data response question and it attracted a lot of candidates who performed fairly above average. The question required the candidates to identify items on the revenue and expenditure sides of a hypothetical budget, state two examples of non-tax revenue and determine whether the budget was deficit or a surplus budget in the (d) and (e) parts of the question respectively. Few of the candidates could correctly classify the items under the appropriate headings in the (a) and (b) parts of the question. This prevented them from obtaining the maximum mark.
The candidates were expected to provide the following answers to score higher marks.