The federally funded student did programs generally reduce benefits by $1 for every $1 that recipients earn. Do such programs represent government purchases or transfer payments? Are they automatic stabilizers?
The federally funded student did programs generally reduce benefits by $1 for every $1 that recipients earn. Do such programs represent government purchases or transfer payments? Are they automatic stabilizers?
The federally funded student programs in which benefits reduce as the recipient of it starts earning is part of the government transfer payment. These payments are the money or aid that the individuals received from the government but the individuals do not or pay anything in the exchange. Under this program of student aid, the government gives benefits or money to pay for the college or any career to the students who earn nothing but these benefits get reduced as the student starts earning. It includes grants, scholarship, a work-study job, and loans. On the other hand, government spending includes the only purchase of goods and services, not direct payments.
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