Government transfer payments:
A) are included as part of government purchases, G.
B) can be viewed as negative tax payments, T.
C) are received as payment for inputs in the factor market.
D) do not affect the level of public or private saving.

Question

Quizplus · Accepted Answer

Transfer payments can be viewed as negative tax payments as they represent the government giving money to individuals or households without receiving any goods or services in return, just as taxes are payments made by individuals or households to the government without receiving any goods or services in return.

Government Transfer Payments