Which of the following would be considered a transfer payment?
A) purchases of oil for the strategic petroleum reserve.
B) purchases of military goods for the army.
C) payments to a private subcontractor providing services to the military.
D) payments to wheat farmers when wheat prices fall below $3.80 per bushel.

Question

Quizplus · Accepted Answer

Payments to wheat farmers when wheat prices fall below $3.80 per bushel are considered transfer payments because they are payments made by the government to individuals for which no services or goods are exchanged.

Which of the Following Would Be Considered a Transfer Payment