Government expenditures on goods and services

Question

Explain Government expenditures on goods and services and transfer payments?

Answer 1

1. Government purchases directly use or employ resources to produce goods or services measured in domestic output.

2. Government transfer payments are not directly part of domestic output, but include payments like social security, unemployment compensation, welfare payments.

Changes in government purchases of goods and services, expenditures on transfer payments, and total spending as percentages of U.S. output, 1960 and 2000.