If the U.S. economy grew rapidly in the future, would this eliminate the long run deficit of Social Security?
a. No; future Social Security benefits are tied to nominal wages and therefore increases in real incomes will also increase the future retirement benefits.
b. Yes; a rapid real growth rate would increase tax revenues without increasing the real benefit levels of future recipients.
c. Yes, more rapid growth would lead to inflation and this would help eliminate the system's long run deficit.
d. Yes, but only if the rapid growth led to a substantial increase in net exports.
A
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Present value:
A. is always greater than the future value of money. B. does not account for inflation. C. is how much an amount of money obtained in the future is worth today. D. All of these statements are true.
An example of a good that is not excludable is:
A. fish in the ocean. B. wireless connection to the Internet. C. a movie in a theater. D. a candy bar.
The 2005-2008 Chinese policy with respect to the Yuan has been to
a. allow its currency to float. b. allow its currency to rise in value quickly. c. allow its currency to rise in value slowly. d. allow its currency to fall in value slowly. e. allow its currency to fall in value quickly.
Profits
What will be an ideal response?