4198EconomicsMedium
Because people’s income vary other the life cycle and because there are transitory shocks to people’s incomes the standard measures of income distribution?
Acould exaggerate or understate the inequality of living standards depending on whether the transitory shocks are positive or negative
Bexaggerate the inequality of living standards
Caccurately represent the true inequality of living standards
Dunderstate the inequality of living standards
Correct answer
B. exaggerate the inequality of living standards
Explanation
The correct answer is exaggerate the inequality of living standards.