When state universities charge higher tuition fees to ...

[Jramos095]

When state universities charge higher tuition fees to out-of-state students than to local students, the universities are practicing
 
  A) first-degree discrimination.
  B) second-degree discrimination.
  C) third-degree discrimination.
  D) fourth-degree discrimination.

Question 2

Give two reasons why Social Security is compulsory for most workers.
 
  What will be an ideal response?

[Jody Vaughn]

Answer to Question 1

C

Answer to Question 2

Since the Social Security program redistributes resources as well as provides insurance, it makes sense that it is compulsory for two reasons. First, the redistributive nature of the program makes it a bad deal for high-income workers who would likely opt out of the system if they were able to. This is called the adverse selection problem. Second, the pay-as-you-go nature of the program requires a regular influx of new contributors, thus new workers need to be forced to enter into the system as it needs their contributions.