Study Questions 7

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Categorical grant: A categorical grant is designated for a specific public

expenditure program. (Examples: federal grants to the states for Medicaid,


unemployment compensation, education, and mass transit.)
Lump sum vs. matching
Lump-sum grant: A lump-sum grant does not require the government
receiving the grant to spend any of its own funds on the good or service for
which the grant is provided.

Matching grant: A matching grant requires the receiving government to


spend some of its own funds on the good or service for which the grant is
provided. The grant provides an additional amount of funding for the good or
service to match the amount provided by the receiving government.

Closed-ended vs. open-ended


Closed-ended: The maximum amount of grant funding that a
community can
receive from a closed-ended grant is limited.

Open-ended: There is no maximum amount of grant funding that a


community can receive from an open-ended grant.

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