Exam 14: The Economics of Aging

In a traditional Individual Retirement Account, money is deposited into the fund before taxes are paid and then withdrawals at retirement are taxed as income.

Wealth continues to rise until one dies.

Because so much of the net worth of older people is housing wealth, some retirees have started using their home equity to pay for their retirement.

The idea of a means test appeals to many Americans. One reason for its appeal is the continued growth in living standards for most working Americans.

Personal savings are a third source of income in retirement. Problems with saving for retirement include all of the following except:

Saving rates are lower among the elderly than all other age groups because they spend their money on:

Median net worth is the total value of all assets.

The greatest risk of a means test is that it would create two unequal classes of retirees.

Younger individuals are less likely than older people to choose the Roth Individual Retirement Account in saving for retirement.

The baby boom generation has fewer opportunities than their parents. One reason for this lack of opportunity is:

_____ has proved to be the most successful program of the American welfare.

In the last 40 years, there has been a vast improvement in the economic position of the aged.

The United States is one of several countries thinking about raising the retirement age.

One major obstacle of means-testing is:

The privatization of Social Security would mandate that individuals be more in charge of their own retirement and the government less responsible. One country with a privatization program in existence is:

By the 2030s, there will most likely be a deficit in funding the Social Security benefits because:

A problem with defined contribution plans is that they are vulnerable to big fluctuations.

One of the recommendations to preserve Social Security is to raise the normal retirement age. A consequence of raising it is that: