If people can borrow and lend to perfectly smooth out their lifetime living standards, then?
Alife-cycle income is a good measure of the distribution of living standards.
Bpermanent income is a good measure of the distribution of living standards.
Ccurrent annual income is a good measure of the distribution of living standards.
Dnone of these answers
Etransitory income is a good measure of the distribution of living standards
Correct answer
B. permanent income is a good measure of the distribution of living standards.
Explanation
The correct answer is permanent income is a good measure of the distribution of living standards..