1) The three main categories of government outlays are A) net interest payments, government investment, and government consumption expenditures. B) net government subsidies, the government deficit, and government purchases. C) government purchases, transfer payments, and net interest payments. D) government consumption expenditures, government investment, and transfer payments.

D) government consumption expenditures, government investment, and transfer payments.

Explanation:

What does the Government do with all the taxes it keeps collecting?

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Option D encapsulates this.

Government consumption Spending is a major component of government spending and is done mainly for the direct satisfaction of individual citizens in the Nation. It includes things like Education, Health and Defense.

Another important component is Government Investment. This comprises of all goods and services acquired by the government for the benefit of the nation in future. They include infrastructure spending like roads and bridges as well as research spending.

Finally we have Transfer Payments. This portion of government spending has been on the up and up because it comprises of Social Security benefits and Unemployment insurance. Essentially these are payments that the government receives nothing in return for but underscores the care it has for citizens.

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