Question

Sorry to post in the wrong subject as I am getting no help in the proper subjects.

How do government expenditures affect the economy?

Answer 1

government has jobs that need to be done,
these jobs/services benefit the nation as a whole,
government collects taxes for these services,
uses these taxes in order to pay people who have these jobs and to purchase necessary equipment
people use the money to buy stuff

ECONOMY

Answer 2

Well, the "theory" goes that they should improve the economy.

Answer 3

Think of the whole area scoped by the said government as a company. Government expenditures could be because of many things.
Investments to a company outside itself would affect the absolute wealth of the government but in the long run, when the shares start pouring, it would be a good source of extra income.
If the investment is used inside (within) the company itself, it could be another form of investment as this would mean better production of the members of the company. An example of this would be, better roads, better public infrastructures, better health system would mean that more people would be able to work for the betterment of the company.
If the investment is distributed among all the members of the company, there could be a sudden inflation as demands may increase exponentially and some people might use this to their advantage. This is why the government is not giving away a hundred thousand dollars to every citizen to solve poverty, even though the available wealth can cover that.
If the investment is used as a pocket money of the officials, your company's f***ed.