Suppose expenses for Medicare and Medicaid are rising rapidly. Which strategy could the federal government use to solve this situation?

A. Increase payouts for entitlements and decrease income and payroll taxes so that consumers are provided with more money to pay for increased medical costs.

B. Increase corporate and individual income tax rates to raise revenue, and then eliminate payments to state and local governments to cut other costs in the federal government.

C. Make cuts to defense and education spending, and then increase income and payroll tax rates to reduce the effect of increasing expenses in the federal government.

D. Delay payments for the interest on the national debt and increase tax rates for payroll and corporate income taxes to raise funds for Medicare and Medicaid.
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