(a) What is a budget deficit? Outline two (2) methods on how the government can finance a budget deficit and possible economic implications of each method.(5 marks)

(b)What is a tariff? Refer to diagram 21 b) to explain how a tariff may be used to protect domestic producers (include price, output and total revenue of the protected industry) and identify the area that represents the revenue collected by government.(5 marks)

\f