Grade 10 Economics Chapter 26 Worksheet 2

The Maldives had a budget deficit of $100m in 2015. It was predicting that
the budget deficit would double to S200m in 2016 with a forecast
government revenue of S1.4bn. One-third of government spending was
expected to go on public sector wages and a smaller proportion on
promoting tourism. The Maldivian government gets revenue from a
number of sources including taxation and leasing islands for agriculture,
fisheries and resort development.
a Calculate how much the Maldivian government was expected to spend in
2016.

b Explain how a decline in tourism would be expected to affect the budget

position of the Maldives.