When the Current Social Security Surpluses End and the Bonds

question 64

Multiple Choice

When the current Social Security surpluses end and the bonds in the trust funds are reduced in order to make payments to retirees, the financing for the redemption of the trust fund bonds will come from

• A) higher taxes or more government borrowing.
• B) the surplus funds deposited in government banking accounts.
• C) equity capital being liquidated.
• D) the sale of private equities and securities that the government has been purchasing with the funds.

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Definitions:

Marginal Revenue Product

The additional revenue generated from employing one more unit of a factor of production, such as labor or capital.

Marginal Revenue Product Curve

A graph that illustrates the additional revenue generated from employing one more unit of a resource.

Variable Input

relates to a production factor that can be adjusted in the short term to change the level of output, such as labor or raw materials.

Marginal Revenue Product

The additional revenue generated by employing one more unit of a factor, such as labor, in the production process.