Question

In the Government budget, 'transfer payments' are the payments made by the Government:

• A. On transfer of employees
• B. On purchase of goods or services
• C. Without receiving any goods or services
• D. On purchase of land-property

Hint:

Transfer payments do not involve direct economic activity but are meant for redistribution of income.

Answer 1

The Correct Option is C

Transfer payments are unrequited payments, such as pensions, unemployment benefits, or subsidies, made without any exchange of goods or services.