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11.Which of the following is true about the Social Security pension system in the United States?

a.Pensions received by retired workers are based entirely on their contributions to the Social Security pension trust fund and the investment return on that fund.

b.Pensions received by married retirees with dependents are greater than that received by those without dependents.

c.Gross replacement rates are inversely related to preretirement earnings.

d.both (b) and (c)

12.Which of the following can decrease tax rates necessary to pay pensions for a pay-as-you-go pension system? increase in replacement rates

b.a decrease in the retirement age increase in the size of the work force increase in the number of retirees

13.Unless legislation is introduced to change the normal retirement age, people born in 1960 or later will be able to retire with full Social Security benefits at age:





14.The earnings test for retirees:

a.increases their incentive to work. applied to all retirees. applied only to retirees below normal retirement age.

d.reduces pension benefits by $1 for each $2 of earnings.

e.both (c) and (d)

15.A nation has 40 million current retirees and a work force of 100 million. Which of the following is true?

a.The replacement rate is 40 percent.

b.The replacement is 2.5.

c.The dependency ratio is 0.4.

d.The dependency ratio is 2.5.

16.Social Security tax rates can be reduced if:

a.taxable wages decline.

b.the retirement age is lowered.

c.the retirement age is raised.

d.the work force decreases in size.

         17.    A retiree subject to the earnings test under Social Security:

a.can earn as much as he or she chooses without losing Social Security pension benefits.

b.has his or her Social Security pension benefits reduced by one dollar for each dollar of labor earnings.

c.has his or her Social Security pension benefits reduced immediately by one dollar for each three dollars of labor earnings.

d.has his or her Social Security pension benefits reduced by one dollar for each two dollars of earnings after a certain minimum amount per year.

         18.    A pay-as-you-go social security retirement system is:

a.exemplified by the current U.S. social security system.

b.exemplified by the current Chilean social security system.

c.designed to have retirees set aside a contribution specifically for themselves during their earlier working life.

d.both (a) and (b).

        19.     Approximately, what percentage of beneficiaries of U.S. Social Security are retired workers?





         20.    The Social Security Act was implemented in the United States in:




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