Exam 30: The Economics of Social Security

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Given the current tax rate structure and promised benefit levels,persons that are currently 40 years old or younger can expect to earn approximately what real rate of return on their Social Security contributions?

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Question 1

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The Social Security retirement program is financed by a 10.6 percent payroll tax that applies to earnings up to an income cutoff that is adjusted upward annually by the growth rate of nominal wages.As of 2011,the income cutoff was

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Briefly explain why the Social Security system will face a "crisis" in the coming years.

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The pay-as-you-go Social Security system will face a crisis because as the baby boom generation moves into the retirement phase of life,beginning around 2011,the number of workers per retirement beneficiary will decline,and eventually the system will run larger and larger deficits.While the system is currently running a surplus,for the most part,these funds are used to finance current government operations.When the Social Security system enters its deficit years,the bonds held in the trust funds will be drawn down.However,in order to redeem the bonds,the Treasury will have to either raise taxes or increase borrowing.If the promised benefits were financed by increases in payroll taxes alone,the Social Security payroll tax rate would have to be increased by approximately 50 percent.

The structure of the Social Security system is particularly advantageous to

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Question 4

Demographic conditions

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Question 5

Which of the following best explains why the Social Security system is expected to face financial difficulties in the near future?

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Question 6

Based on average life expectancy,which of the following groups would you expect to collect Social Security benefits for the greatest number of years?

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Question 7

When the Social Security system begins running a deficit during the years following 2018,the bonds in the trust fund will be drawn down.The funds to redeem these bonds will have to come from

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Question 8

If the U.S.economy grew rapidly in the future,would this eliminate the long run deficit of Social Security?

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Question 9

As the baby boom generation retires in the future,Social Security will have to

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Question 10

In 2010,the number of workers per Social Security beneficiary was approximately ;by the year 2030,this figure is expected to .

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Question 11

During the last two decades,most of the surplus generated by the Social Security system was

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Question 12

Social Security,officially known as Old Age and Survivors Insurance (OASI),

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Question 13

By 2030,the number of workers per Social Security beneficiary will be approximately

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Question 14

(I)Because married women are permitted to receive benefits based on either their own earnings or 50 percent of the benefits earned by their spouse,whichever is greater,the payroll tax takes a big chunk of the earnings of many working women without providing any significant additional benefits to them. (II)Because blacks have a shorter life expectancy,they are economically disadvantaged by Social Security relative to whites and Hispanics.

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Question 15

In approximately what year will Social Security outlays begin to exceed revenues?

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Question 16

Which of the following countries have moved toward a retirement system based more on personal retirement accounts (and savings and investment principles)rather than pay-as-you-go principles?

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Question 17

The Social Security system is currently generating tax revenues that exceed the benefits paid to recipients.This surplus is

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Question 18

What will the federal government have to do in order to redeem the bonds in the Social Security Trust Fund?

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Question 19

The bonds held in the Social Security Trust Fund

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Question 20

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Exam 30: The Economics of Social Security

Given the current tax rate structure and promised benefit levels,persons that are currently 40 years old or younger can expect to earn approximately what real rate of return on their Social Security contributions?

The Social Security retirement program is financed by a 10.6 percent payroll tax that applies to earnings up to an income cutoff that is adjusted upward annually by the growth rate of nominal wages.As of 2011,the income cutoff was

Briefly explain why the Social Security system will face a "crisis" in the coming years.

The structure of the Social Security system is particularly advantageous to

Demographic conditions

Which of the following best explains why the Social Security system is expected to face financial difficulties in the near future?

Based on average life expectancy,which of the following groups would you expect to collect Social Security benefits for the greatest number of years?

When the Social Security system begins running a deficit during the years following 2018,the bonds in the trust fund will be drawn down.The funds to redeem these bonds will have to come from

If the U.S.economy grew rapidly in the future,would this eliminate the long run deficit of Social Security?

As the baby boom generation retires in the future,Social Security will have to

In 2010,the number of workers per Social Security beneficiary was approximately ____;by the year 2030,this figure is expected to ____.

During the last two decades,most of the surplus generated by the Social Security system was

Social Security,officially known as Old Age and Survivors Insurance (OASI),

By 2030,the number of workers per Social Security beneficiary will be approximately

In approximately what year will Social Security outlays begin to exceed revenues?

Which of the following countries have moved toward a retirement system based more on personal retirement accounts (and savings and investment principles)rather than pay-as-you-go principles?

The Social Security system is currently generating tax revenues that exceed the benefits paid to recipients.This surplus is

What will the federal government have to do in order to redeem the bonds in the Social Security Trust Fund?

The bonds held in the Social Security Trust Fund

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In 2010,the number of workers per Social Security beneficiary was approximately ;by the year 2030,this figure is expected to .