Economics 9708 · AS & A Level · Short-run costs

Short-run costs — practice question

A report from the UK argues that means-tested benefits (benefits paid according to income) ought to be introduced for benefit payments to elderly people, and that any savings made should then be used to fund means-tested benefits for young adults. This is because some elderly people now have relatively high real incomes. Which outcome is most likely?

  • AEquality amongst young adults will decrease.
  • BEquality amongst the elderly will decrease.
  • CIntergenerational equality will increase.
  • DThere will be an increase in transfer payments.

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