Social Security benefit amounts are increased annually by automatic cost-of-living adjustments.The theory is to:
A)prevent inflation from eroding the value of Social Security.
B)encourage economic growth.
C)reduce the moral hazard of malingering.
D)discourage adverse selection in Social Security.
E)cope up with increases in health care expenses.

Question

Quizplus · Accepted Answer

The automatic cost-of-living adjustments (COLAs) are designed to prevent inflation from eroding the purchasing power of Social Security benefits, ensuring that the value of the benefits keeps pace with the cost of living.

Social Security Benefit Amounts Are Increased Annually by Automatic Cost-Of-Living