In a financial year, a government collected \text{₦}650\text{ billion} in tax revenue and … — JAMB UTME

In a financial year, a government collected $\text{₦}650\text{ billion}$ in tax revenue and $\text{₦}180\text{ billion}$ in non-tax revenue. During the same period, its recurrent expenditure was $\text{₦}520\text{ billion}$ and its capital expenditure was $\text{₦}460\text{ billion}$ . What is the government's budget deficit in billions of Naira ( $\text{₦}$ )?

Cevap: 150 billion Naira

Cevap

The government's budget deficit is

\text{₦}150\text{ billion}

The budget deficit represents the excess of total expenditure over total revenue in a fiscal period. Adding tax revenue (

\text{₦}650\text{ billion}

) and non-tax revenue (

\text{₦}180\text{ billion}

) gives a total revenue of

\text{₦}830\text{ billion}

. Adding recurrent expenditure (

\text{₦}520\text{ billion}

) and capital expenditure (

\text{₦}460\text{ billion}

) yields a total expenditure of

\text{₦}980\text{ billion}

. The difference (

\text{₦}980\text{ billion} - \text{₦}830\text{ billion}

) results in a budget deficit of

\text{₦}150\text{ billion}

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Calculate Total Revenue

Total Revenue =

\text{₦}830\text{ billion}

Total revenue is the sum of tax revenue and non-tax revenue:

\text{₦}650\text{ billion} + \text{₦}180\text{ billion} = \text{₦}830\text{ billion}

Calculate Total Expenditure

Total Expenditure =

\text{₦}980\text{ billion}

Total expenditure is the sum of recurrent expenditure and capital expenditure:

\text{₦}520\text{ billion} + \text{₦}460\text{ billion} = \text{₦}980\text{ billion}

Calculate Budget Deficit

Budget Deficit =

\text{₦}150\text{ billion}

A budget deficit occurs when total expenditure exceeds total revenue. Deficit = Total Expenditure - Total Revenue =

\text{₦}980\text{ billion} - \text{₦}830\text{ billion} = \text{₦}150\text{ billion}

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Budget Deficit Calculation

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