Many in Congress expect that future Social Security tax collections will fall short of the sum that will be
needed to cover promised benefits. How can it cover this shortfall, and what are the problems associated
with these solutions?
7. Congress expects Social Security and Medicaid to fall short of revenue that will be needed to cover
promised benefits in the future. On what evidence are these expectations based?
8. What are the main characteristics of a public good? Why does the government produce public goods rather
than allowing firms in the competitive market to do so?
9. Suppose that you are an economist working for the United States government and are asked to defend the
level and growth of government spending. What information could you use to your advantage?
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