Question

What are transfer payments?

Answer 1

Transfer payments are received without any contribution to current production. They are unilateral payments, meaning one-way transfers, for which the receiver does not provide any goods or services in return during the current period.

Examples of transfer payments:

1. Old-age pensions
2. Unemployment benefits
3. Welfare payments
4. Scholarships
5. Gifts and donations
6. Taxes and fines