CAIE A-Level Economics 5.2.5 Government Spending

CAIE A-Level Economics 5.2.5 Government Spending
Cambridge International AS & A Level Economics 9708 syllabus for exams in 2026, 2027 and 20282026–2028

Practise classifying current, capital and transfer expenditure, calculating totals from budget tables and selecting health or education allocations using marginal welfare evidence.

How this is tested

  • classify infrastructure or equipment as capital, operating services as current and benefits as transfers
  • calculate transfer payments or spending changes from a government expenditure table
  • allocate a fixed budget by comparing marginal welfare gains across health and education

Question 18

[Maximum number: 1]

A government spends money to provide an education for students.
Which type of spending is capital expenditure?

A

computers for classrooms

B

grants for university students

C

rent for school buildings

D

wages for teachers