As more and more of the baby-boom generation reach retirement age and draw on Social Security and Medicare,
A) the Social Security Trust Fund will switch from running a deficit to a surplus.
B) unfunded promises included in the federal budget will decrease.
C) expenditures on these programs will increase the size of the federal debt.
D) the federal debt as a share of GDP will decrease.

Question

Quizplus · Accepted Answer

The increase in retirees drawing on Social Security and Medicare will lead to an increase in the amount of expenditures required for these programs, thus contributing to the size of the federal debt. The Social Security Trust Fund already runs a deficit, so option A is incorrect. There is no indication that unfunded promises will decrease, so option B is also incorrect. The federal debt as a share of GDP will likely increase due to the increased expenditures, so option D is incorrect.

As More and More of the Baby-Boom Generation Reach Retirement