Transfer Payments Are Not Included in GDP Because

question 131

Multiple Choice

Transfer payments are not included in GDP because

• A) their market value cannot be accurately determined.
• B) their value is included in government expenditure.
• C) they do not generate additional income.
• D) they are not purchases of goods or services.

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Definitions:

Internal Rate Of Return

A financial metric used to estimate the profitability of potential investments by calculating the discount rate that makes the net present value of all cash flows equal to zero.

Discounted Cash Flow

A financial analysis technique that estimates the value of an investment based on its expected future cash flows, discounted back to their present value.

Future Cash Flows

Estimated monetary gains or expenditures that a company expects to receive or pay out in the future.