When estimating poverty rates, one will get the same result regardless of whether the Low Income Measure, Market Basket Measure, or Low Income Cut-Off is used.

Question

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Each measure has a different methodology for estimating poverty rates. The Low Income Measure (LIM) is relative, based on median incomes; the Market Basket Measure (MBM) estimates the cost of a specific set of goods and services to determine poverty; and the Low Income Cut-Off (LICO) is based on the percentage of income spent on necessities. Therefore, the poverty rate can vary depending on which measure is used.

When Estimating Poverty Rates, One Will Get the Same Result