17.

Which of the following is true about Social Security? 0 Higherincome people have greater Social Security wealth than lowerincome people on average. (Q A major rationale for having Social Security is to help people smooth consumption as they transition from working to retirement. 0 Social Security creates adverse selection concerns because it might inuence individuals' decisions about when to retire. Q There is no crowd out associated with Social Security because everyone age 62 and older is eligible to receive benets under the program. 0 All of the above. Which of the following is an example of adverse selection? People who live in states with more generous unemployment insurance (UI) benefits tend to save less while they are working, such that they have less in private savings to draw on in the event that they are laid off from their jobs. O Individuals with health insurance plans that provide first-dollar coverage consume significantly more health care than similar individuals with less generous health insurance plans. O The only individuals who are interested in purchasing insurance against flood risk are those whose homes are in areas very likely to be impacted by a flood. O All of the above are examples of adverse selection.A categorical welfare program is less subject to moral hazard if O the characteristic on which eligibility is determined is unchangeable. O the income level that determines eligibility is high. O the program provides cash welfare benefits instead of in-kind welfare benefits. O the program uses a measure of relative inequality instead of a measure of absolute deprivation to determine eligibility