If permanent income were utilised to measure the income distribution instead of current annual income, the income distribution would appear to be wider.

Name: If permanent income were utilised to measure the income distribution instead of current annual income, the income distribution would appear to be wider.
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Question

Quizplus · Accepted Answer

Permanent income tends to smooth out temporary fluctuations in income, leading to a narrower distribution compared to current annual income, which can vary significantly year to year.

If Permanent Income Were Utilised to Measure the Income Distribution