BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Social Security replaces a percentage of a worker’s pre-retirement income based on your lifetime earnings. The amount of your average wages that Social Security retirement benefits replaces depends on your earnings and when you choose to start benefits.

Detailed explanation-2: -The Old-Age, Survivors, and Disability Insurance ( OASDI ) program provides monthly benefits to qualified retired and disabled workers and their dependents and to survivors of insured workers. Eligibility and benefit amounts are determined by the worker’s contributions to Social Security.

Detailed explanation-3: -Social Security provides insurance against this outcome and can therefore raise welfare. On the other hand, Social Security distorts saving behavior because it reduces the need to provide for one’s own retirement. Therefore, individuals save less and aggregate savings and output fall when Social Security is available.

Detailed explanation-4: -The difference between the two lies in the scope of operation. Social insurance is primarily aimed at protection from want and hunger, whereas social security besides want and hunger also helps removal of squalor, diseases, ignorance and exploitation.