Question : Which of the following is not a gross domestic product (GDP) component?
Option 1: Personal consumption expenditures
Option 2: Gross private domestic investment
Option 3: Net exports
Option 4: Government transfer payments
Correct Answer: Government transfer payments
Solution : The correct answer is (d) Government transfer payments
Government transfer payments are not considered a component of Gross Domestic Product (GDP). Transfer payments are payments made by the government to individuals or households for which no goods or services are exchanged. Examples of transfer payments include social security benefits, welfare payments, and unemployment benefits. These payments are considered transfers of income and do not represent current production or economic activity.
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