Why do consumers benefit from pay-as-you-go social security?
A) With sufficiently high population growth, many young contribute to the benefits of the old.
B) With sufficiently low population growth, the young can perpetually contribute more.
C) It is a better way than taxes to finance the government.
D) It keeps inflation in check as money is redistributed.
E) It forces people to save more than they would otherwise.
Correct Answer:
Verified
Q24: Pay-as-you-go social security works in situations where
A)Ricardian
Q25: A default premium is the interest rate
Q26: In a simple model of credit imperfections,
Q27: If the collateral constraint does NOT bind,
Q28: A fully funded social security program
A)solves the
Q30: The phenomenon that some consumers pay a
Q31: Credit market frictions were important during the
Q32: In the two-period model with asymmetric information,
Q33: Collateralizable wealth is
A)any asset that can be
Q34: If consumers use their house as collateral
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