Question

govrenment purchases and transfer payment differ because the former absorb resources while the latter do not

Answer 1

It is true that government purchases and transfer payments differ in that the former absorbs resources while the latter does not.

What does government purchase and transfer payments mean?

Government purchases are goods and services purchased by the government such as Transportation and Defense. Government transfers payments are amounts paid directly by the government to certain individuals, such as the elderly or disabled, in which the payer receives nothing in return. Transfer payments reduces the incentive to work

Does government purchases include transfer payment?

Government purchases include all federal, state, and local government expenditures, but exclude debt and transfer payments such as Social Security.

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