Social Security

question 62

Multiple Choice

Social Security

• A) collects taxes from current workers and invests this money to repay the workers when they retire.
• B) is based on the same principles as private insurance programs.
• C) is an intergenerational transfer program that takes money from current workers and transfers it to current retirees.
• D) is designed so that administrative decisions can be made independent of political concerns.

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Definitions:

Stocks

Shares of ownership in a company that entitle the shareholder to a proportion of the company's profits and assets.

T-bond Futures

Futures contracts that obligate the buyer to purchase Treasury bonds at a specified price at a future date.

Initial Margin

The minimum amount of funds required to be deposited in a margin account before trading on leverage to ensure that the account can cover potential losses.

Maintenance Margin

The minimum amount of equity that must be maintained in a margin account to cover potential losses.