Which of the Following Represents a Problem in Measuring Inequality

question 89

Multiple Choice

Which of the following represents a problem in measuring inequality?

• A)Measurements of income distributions typically include in-kind transfers, which distort the measure of inequality.
• B)A normal life-cycle pattern causes inequality in the income distribution but may not reflect inequality in living standards.
• C)Transitory income is a better measure of inequality than permanent income.
• D)Both a and b are correct.

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Definitions:

Functional Fixedness

A cognitive bias that limits a person's ability to use an object only in the way it is traditionally used, preventing them from solving a problem in a creative manner.

Mental Set

A cognitive bias that limits a person to using an approach that has previously worked, even when a different approach might be more beneficial.

Pencil Eraser

A tool made of rubber or similar substances used to remove graphite or ink marks from paper.

Trial And Error

A problem-solving method involving trying various solutions until finding one that works, often learning from mistakes.