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Which of the following is included in GDP as government purchases?

  
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Which of the following is included in GDP as government purchases?

Postby lorimar » Thu Jul 12, 2012 2:48 am

I have these questions for my Economics class but I read and read the book and can't find the answer

A. Social Security payment to eldery citizens
B. welfare benefits distributed to the the poor
C. Outright grants from government to recipients
D. payments to clerical workers hired by government
E. Unemployment compensation benefits

In the above question, I believe the answer is D but not completely sure, thanks for the help.
and the other questio is

-The immediate effect on GDP of Ibrahim's Purchase of a government bond is
A. a decrease in consumption because Ibrahim has less money to spend
B. an increase in government spending
C. An increase in investment
D. a decrease in investment because less money is available for him for further investment
E. nonexistent, since no real goods and services have been produced

in that one I'm between A, C and E but then again I'm not 100% sure.. Thank you for your help
lorimar
 
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Which of the following is included in GDP as government purchases?

Postby tim » Thu Jul 12, 2012 2:57 am

D

E
tim
 
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Which of the following is included in GDP as government purchases?

Postby patwin87 » Thu Jul 12, 2012 2:59 am

1. D,because it is not a transfer payment.
2. E, a financial transaction will not affect GDP.
patwin87
 
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Which of the following is included in GDP as government purchases?

Postby pannoowau » Thu Jul 12, 2012 3:06 am

Part B AB CD IS CORRECT.
PART A
D is not fully correct because it is not producing any visible goods
I may be wrong
pannoowau
 
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