An Example of a Government Expenditure That Is a Transfer

question 3

Multiple Choice

An example of a government expenditure that is a transfer payment is

• A)employment-insurance (EI)payments.
• B)construction costs of a new government-owned airport.
• C)salaries of welfare case workers.
• D)education payments.
• E)payments made to the Canadian International Development Agency (CIDA).

---

Definitions:

Shortage

A situation where the demand for a good or service exceeds its supply in the market, often leading to increased prices.

Initial Equilibrium

The initial state of balance where the supply and demand curves intersect, determining the market price and quantity before any external changes.

Equilibrium Price

The market price at which the quantity of goods demanded is equal to the quantity of goods supplied.

Equilibrium Quantity

The quantity of goods or services supplied that is equal to the quantity demanded at the market equilibrium price.