Transfer payments are included in government budgets as spending,but are not included in the government purchases category of GDP.

Question

Quizplus · Accepted Answer

Transfer payments, which include programs such as social welfare benefits and subsidies, are considered government spending and are therefore included in government budgets. However, they do not contribute to the production of goods and services in the economy, so they are not included in the government purchases category of GDP.

Transfer Payments Are Included in Government Budgets as Spending,but Are