Asked by Meagan Silver on Jun 19, 2024
Verified
"Transfer payments" may be thought of as
A) wages and salaries.
B) purchases of services.
C) taxes in reverse.
D) expenditures on products.
Transfer Payments
Payments made by the government to individuals without the expectation of a direct economic return, typically to assist with income support.
- Differentiate the impact on resource allocation by comparing government purchases with transfer payments.
Verified Answer
NM
Norman MinervaJun 26, 2024
Final Answer :
C
Explanation :
Transfer payments are considered as "taxes in reverse" because they are payments made by the government to individuals without the government receiving any goods or services in return, similar to how taxes are payments made by individuals to the government without a direct return of goods or services.
Learning Objectives
- Differentiate the impact on resource allocation by comparing government purchases with transfer payments.