Question

Government purchases include spending on _____. rev: 04_09_2018 Multiple Choice government purchases of final goods and government salaries government purchases of final goods, government salaries, and transfer payments government salaries only government purchases of final goods only

Answer 1

Answer:

The correct answer is:  government purchases of final goods and government salaries.  

Explanation:

Government purchases refer to the government s[pending on goods and services. The salary paid to the officials is included in the government expenditures as the government is getting services in return.

the transfer payments such as social security benefits etc are not included in the government expenditures as they are not providing anything directly in return.