Why Do Social Security and Medicare Pose Problems for the Federal

question 166

Multiple Choice

Why do Social Security and Medicare pose problems for the federal government budget?

• A) The programs do not cover enough people.
• B) The worker-to-retiree ratio is decreasing.
• C) The number of retirees is decreasing.
• D) The number of sick people is rising too quickly.
• E) Social insurance taxes are capped and cannot be raised.

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Definitions:

Reasonable Level

A term often used in finance and economics to describe an equilibrium or average measure that is considered acceptable under given conditions.

Capital Budget

The planning process used by a company to determine whether its long-term investments or projects are worth pursuing.

Dividend Per Share

The sum of declared dividends for every share of common stock issued, divided by the number of outstanding shares.

Outstanding Shares

The total shares of stock that are currently owned by shareholders, including restricted shares owned by company insiders.