SOLVED

1) In the postwar era, the federal budget has typically been ________. A) balanced B) in surplus C) in deficit D) the largest component of Gross Domestic Product 2) One of the consequences of inflation between 1950 and the 1970s was ________. A) a large increase in the federal deficit as a percentage of GDP B) a relaxation of the government budget constraint C) an increase in the dependency ratio D) a reduction in the ratio of debt to real GDP 3) The most recent U.S. President to preside over an annual federal budget surplus was ________. A) George H. W. Bush (1989-1993) B) Gerald Ford (1974-1977) C) Dwight Eisenhower (1953-1961) D) George W. Bush (2001-2009) 4) The pay-as-you-go system for the Social Security System entails. ________. A) a transfer of payments from those currently working to retirees. B) taxing the import and export of goods and services into an out of the United States. C) a number of current retirees that exceeds the number of employed individuals. D) issuing additional government debt in the event of budget surplus. 5) The ratio of retirees to workers who make contributions to the Social Security system ________. A) has increased over the years B) increased as a result of the baby boom following World War II, but has subsequently declined C) has fallen with the decline in U.S. birth rates D) determines the size of contributions to the system 6) In the next several decades, the dependency ratio relevant to the Social Security system is expected to ________. A) remain largely unchanged. B) rise. C) fall. D) fluctuate unpredictably 7) Federal transfers are expected to grow significantly in the coming decades, due especially to increases in ________. A) federal government consumption B) federal deficits C) Medicare and Medicaid D) Social Security payments 8) As of 2008, government debt as a percentage of GDPÂ was ________ in the United States, compared to 29 other major economies. A) at a moderate level B) extremely low C) exceptionally high D) much lower than average 9) The Congressional Budget Office projects that Social Security spending will rise from 4.8% of GDP to 5.7% over the next four decades. Why is that a problem?