Which of the following is true?

Question

Quizplus · Accepted Answer

Government purchases, which include spending on goods and services such as infrastructure and defense, are counted in GDP because they represent economic activity. Transfer payments such as Social Security and welfare benefits are not included in GDP because they are not considered economic activity.

Note: A is false as the United States does not spend the highest percentage of GDP on foreign aid. B is false as the largest federal government purchase of goods and services is defense, not Social Security. D is false as net interest on the national debt is currently around 8% of total federal government spending.

Which of the Following Is True