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Which of the following are the examples of Transfer Payments?

A. Expenditure on scholarships.

B. Expenditure on unemployment benefits.

C. Expenditure on subsidies.

D. Expenditure on imports.

Choose the correct answer from the options given below:

Solution

✅ Correct Option: 2

Transfer payments are one-way payments made without any corresponding good or service received in return. Scholarships, unemployment benefits and subsidies fit this definition. Expenditure on imports is a payment against goods received, so it is not a transfer payment. Hence A, B and C only.

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