Under Social Security, the surplus (the excess of tax receipts over benefit payments)
A. does not exist; the system runs at a deficit.
B. is invested in the form of US Treasury Notes (i.e. government debt).
C. is held in a "lockbox" for current workers when they retire.
D. is invested in stocks and corporate bonds.
Answer: B
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Which type of borrowers were least likely to default in their mortgage at the beginning of the financial crisis?
A) those with fixed-rate mortgages who made large down payments B) those with alt-A loans C) subprime borrowers D) those with adjustable-rate mortgages
If a firm finances a new project using its own funds,
a. the cost is minimal b. the opportunity cost of borrowing has been avoided c. investment funds will be in excess supply d. the financing charges are the measure of the real interest rate e. the interest rate represents the firm's opportunity cost
The short-run supply curve for a good is upward sloping because it is possible for producers to completely adjust the resources used in production in response to price changes
Indicate whether the statement is true or false
Say's Law implies that:
A. Wages and prices are fixed. B. Full employment equilibrium is unlikely. C. Whatever is produced will be sold. D. Unemployment causes inflation.