Question 1

Social security benefits have exceeded/will exceed payroll taxes starting in

Accepted Answer

A)  2005. 
B)  2010. 
C)  2020. 
D)  2030. 
A)  2005. 
B)  2010. 
C)  2020. 
D)  2030.

Question 2

Social Security wealth is the future value of the Social Security system.

Accepted Answer

A)  True 
B)  False 
C)  Uncertain 
A)  True 
B)  False 
C)  Uncertain

Question 3

Average indexed monthly earnings are derived from the worker's earnings history and determine the primary insurance amount (PIA).

Accepted Answer

A)  True 
B)  False 
C)  Uncertain 
A)  True 
B)  False 
C)  Uncertain

Question 4

Social Security was not designed to provide insurance against outliving one's retirement.

Accepted Answer

A)  True 
B)  False 
C)  Uncertain 
A)  True 
B)  False 
C)  Uncertain

Question 5

Suppose that the ratio of retirees to working citizens is currently 1 to 5,meaning that there are 5 working people for every retiree.Suppose that in thirty years the ratio will change to 1 to 2.If benefits remain the same,what will happen to the tax rate assuming retirees are provided benefits in a pay-as-you-go system? How much would benefits decrease if the tax rate remained the same?

Accepted Answer

Initially,a worker paid for 20 percent o

Question 6

Having a Social Security program makes people less inclined to save for their own retirement.

Accepted Answer

A)  True 
B)  False 
C)  Uncertain 
A)  True 
B)  False 
C)  Uncertain

Question 7

Asymmetric information generally implies

Accepted Answer

A)  information between parties is not equal. 
B)  all parties are fully informed. 
C)  information is costless. 
D)  information is too costly to transmit. 
A)  information between parties is not equal. 
B)  all parties are fully informed. 
C)  information is costless. 
D)  information is too costly to transmit.

Question 8

Social insurance can be justified on the grounds of

Accepted Answer

A)  adverse selection. 
B)  decision-making costs. 
C)  income distribution. 
D)  paternalism. 
E)  all of these answer options are correct. 
A)  adverse selection. 
B)  decision-making costs. 
C)  income distribution. 
D)  paternalism. 
E)  all of these answer options are correct.

Question 9

A current worker may save more towards retirement so that he or she will have more to leave his or her children later.This altruistic motive is known as the

Accepted Answer

A)  altruism effect. 
B)  bequest effect. 
C)  income effect. 
D)  savings effect. 
A)  altruism effect. 
B)  bequest effect. 
C)  income effect. 
D)  savings effect.

Question 10

Work disincentives in the system of Social Security have seen the number of persons in the program increase dramatically.What incentives could be put in place to reverse,or at least slow,this trend?

Accepted Answer

Increasing the retirement age would see

Question 11

Carve-out accounts

Accepted Answer

A)  applies only to workers between 65 and 69 years of age. 
B)  take funds away from the traditional social security system. 
C)  has a tax rate of no more than 16.9 percent. 
D)  all of these answer options are correct. 
A)  applies only to workers between 65 and 69 years of age. 
B)  take funds away from the traditional social security system. 
C)  has a tax rate of no more than 16.9 percent. 
D)  all of these answer options are correct.

Question 12

An actuarially fair return means

Accepted Answer

A)  returns on investments are indexed to the stock market. 
B)  returns on investments have to be positive. 
C)  benefits received,on average,would be equal to the premiums paid. 
D)  premiums for insurance are generally paid by the government. 
A)  returns on investments are indexed to the stock market. 
B)  returns on investments have to be positive. 
C)  benefits received,on average,would be equal to the premiums paid. 
D)  premiums for insurance are generally paid by the government.

Social security benefits have exceeded/will exceed payroll taxes starting in

Social Security wealth is the future value of the Social Security system.

Average indexed monthly earnings are derived from the worker's earnings history and determine the primary insurance amount (PIA).

Social Security was not designed to provide insurance against outliving one's retirement.

Having a Social Security program makes people less inclined to save for their own retirement.

Asymmetric information generally implies

Social insurance can be justified on the grounds of

A current worker may save more towards retirement so that he or she will have more to leave his or her children later.This altruistic motive is known as the

Work disincentives in the system of Social Security have seen the number of persons in the program increase dramatically.What incentives could be put in place to reverse,or at least slow,this trend?

Carve-out accounts

An actuarially fair return means

Introduction

Tools of Positive Analysis

Tools of Normative Analysis

Public Goods

Externalities

Political Economy

Education

Cost-Benefit Analysis

The Health Care Market

Government and the Market for Health Care

Income Redistribution: Conceptual Issues

Expenditure Programs for the Poor

Taxation and Income Distribution

Taxation and Efficiency

Efficient and Equitable Taxation

The Personal Income Tax

Personal Taxation and Behavior

The Corporation Tax

Deficit Finance

Fundamental Tax Reform: Taxes on Consumption and Wealth

Public Finance in a Federal System

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Exam 11: Social Security

Social security benefits have exceeded/will exceed payroll taxes starting in

Social Security wealth is the future value of the Social Security system.

Average indexed monthly earnings are derived from the worker's earnings history and determine the primary insurance amount (PIA).

Social Security was not designed to provide insurance against outliving one's retirement.

Having a Social Security program makes people less inclined to save for their own retirement.

Asymmetric information generally implies

Social insurance can be justified on the grounds of

A current worker may save more towards retirement so that he or she will have more to leave his or her children later.This altruistic motive is known as the

Work disincentives in the system of Social Security have seen the number of persons in the program increase dramatically.What incentives could be put in place to reverse,or at least slow,this trend?

Carve-out accounts

An actuarially fair return means

Introduction

Tools of Positive Analysis

Tools of Normative Analysis

Public Goods

Externalities

Political Economy

Education

Cost-Benefit Analysis

The Health Care Market

Government and the Market for Health Care

Income Redistribution: Conceptual Issues

Expenditure Programs for the Poor

Taxation and Income Distribution

Taxation and Efficiency

Efficient and Equitable Taxation

The Personal Income Tax

Personal Taxation and Behavior

The Corporation Tax

Deficit Finance

Fundamental Tax Reform: Taxes on Consumption and Wealth

Public Finance in a Federal System

Filters