Neco 2025 Government Question 28

Nigeria aims to keep foreign‑exchange reserves of at least \(\$10\) billion. At the start of the fiscal year the reserves were \(\$8\) billion. During the year the country earned export revenues of \(\$15\) billion, imported goods worth \(\$22\) billion, received foreign aid of \(\$3\) billion and repaid external debt of \(\$2\) billion. The central bank intervenes by increasing reserves by \(5\%\) of the trade deficit.\n\n(a) After all transactions, what is the shortfall (in billions of dollars) relative to the target reserve?\n(b) If the shortfall is financed by an IMF loan at \(4\%\) annual interest compounded yearly, what will be the total amount owed after three years? (Give the answer to two decimal places.)