The government purchases component of GDP includes salaries paid to soldiers but not Social Security benefits paid to the elderly.

Question

Quizplus · Accepted Answer

Government purchases include spending on goods and services that are directly consumed or invested by the government, such as salaries for military personnel, but do not include transfer payments like Social Security benefits, which are considered transfers rather than purchases of goods and services.

The Government Purchases Component of GDP Includes Salaries Paid to Soldiers