Final answer:
No, a payment made by a city-owned utility to the General Fund of the city in lieu of taxes is not an example of an internal exchange transaction. Instead, it is an example of a transfer payment.
Step-by-step explanation:
No, a payment made by a city-owned utility to the General Fund of the city in lieu of taxes is not an example of an internal exchange transaction. Instead, it is an example of a transfer payment. Transfer payments are payments made by the government to individuals, organizations, or other levels of government without receiving a good or service in return. In this case, the city-owned utility is making a payment to the General Fund, which is a part of the city government, in order to support the city's operations and services. This payment is not a transaction where the utility is receiving something in return directly.