As a proportion of GDP,if estimated revenues equal 30 per cent and estimated outlays equal 27 per cent,the cash balance of the budget is estimated to be:
A)a surplus of 57 per cent.
B)a surplus of 3 per cent.
C)a deficit of 3 per cent.
D)a deficit of 57 per cent.
E)indeterminate as not enough information is provided.

Question

Quizplus · Accepted Answer

To calculate the cash balance of the budget, we need to subtract outlays from revenues:

Cash balance = revenues - outlays

In this case,

Cash balance = 30% - 27% = 3%

Since revenues exceed outlays, there is a surplus of 3% of GDP. Therefore, the correct answer is choice (B).

As a Proportion of GDP,if Estimated Revenues Equal 30 Per