Which of the Following Statements Is Not Correct

question 70

Multiple Choice

Which of the following statements is not correct?

• A) The law requires Social Security to use its surpluses to purchase U.S. Government securities from the Treasury.
• B) Public debt will finance most of the on-budget deficit during the next decade.
• C) The Social Security surplus will finance most of the on-budget deficit during the next decade.
• D) Foreign debt will finance the on-budget deficit during the next decade.

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Definitions:

Secondary Reserves

Liquid assets held by financial institutions as backup funds for unforeseen needs, not directly utilized in lending or investment.

Required Reserves

The minimum amount of funds that banks are required to hold in reserve against deposits, as mandated by central banks.

Money Supply

The total amount of monetary assets available in an economy at any given time.

Federal Reserve

The central banking system of the United States, responsible for monetary policy, including regulating interest rates and managing the country's money supply.