Suppose that in 2011, Mexico's total government outlays were 657 billion pesos and total government revenue was550 billion pesos. Calculate Mexico's budget surplus or deficit. Be sure to include a negative sign if appropriate.billion pesosSelect the answer that best describes the impact that the surplus or deficit you calculated will have on Mexico's debt.Mexico's debt will rise by an amount equal to the size of the deficitO Mexico's debt will not change.OMexico's debt will fall by an amount equal to the size of the surplus

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Asked Mar 20, 2019
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Suppose that in 2011, Mexico's total government outlays were 657 billion pesos and total government revenue was
550 billion pesos. Calculate Mexico's budget surplus or deficit. Be sure to include a negative sign if appropriate.
billion pesos
Select the answer that best describes the impact that the surplus or deficit you calculated will have on Mexico's debt.
Mexico's debt will rise by an amount equal to the size of the deficit
O Mexico's debt will not change.
OMexico's debt will fall by an amount equal to the size of the surplus
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Suppose that in 2011, Mexico's total government outlays were 657 billion pesos and total government revenue was 550 billion pesos. Calculate Mexico's budget surplus or deficit. Be sure to include a negative sign if appropriate. billion pesos Select the answer that best describes the impact that the surplus or deficit you calculated will have on Mexico's debt. Mexico's debt will rise by an amount equal to the size of the deficit O Mexico's debt will not change. OMexico's debt will fall by an amount equal to the size of the surplus

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Expert Answer

Step 1

We are given:

Total outlay/ Total expenditure of Mexican government= 657 billion pesos

Total Revenue of Mexican government= 550 billion pesos

Step 2

i)Budget deficit is defined as the excess of government expenditure over government revenue. Since Mexican government’s expenditure exceeds revenue, Mexican government is running a budget deficit calculated as follows:

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Step 3

ii)   Debt is the accumulation of government borrowings over a period of time. When government runs deficits, it is...

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