Transfer Payments Are Not Part of Government Expenditure on Goods

question 79

Multiple Choice

Transfer payments are not part of government expenditure on goods and services because transfer payments

• A) are not predictable given the nature of their appropriation and allocation.
• B) do not represent the purchase of a final good or service.
• C) are not always spent on goods produced in the U.S.
• D) The premise of the question is incorrect because transfer payments are part of government purchases of goods and services.

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Definitions:

Output

The total amount of goods and services produced by an economy, company, or industry within a specific period.

Long-Run Supply Curve

A graphical representation showing the relationship between price and the quantity supplied that firms are willing to produce, given all inputs are variable.

Output

The cumulative quantity of products or services generated by a corporation, sector, or economic system.

Short Run

A period in economics during which at least one factor of production is fixed, influencing decisions on production and costs.