The table shows four transactions in the UK economy.
| Transaction | Description |
|---|---|
| 1 | The government receives business rates from the owner of an office building. |
| 2 | The government pays for repairs to the roof of an existing hospital. |
| 3 | The government pays for the construction of a new prison. |
| 4 | The government pays the salaries of teachers at a state school. |
Which transaction is UK government expenditure and is classified correctly?
Transaction 4: transfer payment
Transaction 1: current spending
Transaction 2: capital spending
Transaction 3: capital spending
75 exam-style questions on AQA GCSE Economics 2.1 Introduction to the national economy, covering 2.1.1a What an interest rate is, 2.1.1b Interest rates and consumer decisions, 2.1.1c Interest rates, producer decisions and calculations, 2.1.2a UK government revenue and spending, and 2.1.2b Direct, indirect and progressive taxation. Each one has a worked solution and a mark scheme showing where the marks go.