The most equally distributed type of income.

Question

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Answer 1

Question

Chapter 15, Problem 1QP

To determine

The most equally distributed type of income.

Expert Solution & Answer

Explanation of Solution

Yes, the life cycle income is more equally distributed than the transitory income. This is because when an individual joins an employment after studies, the initial level of salary will be lower and as and when he moves on with experience, his salary also increases. It will reflect on the annual income, which is lower at the younger periods and higher in the elder periods. Thus, people have temporarily high or low income, and this means that the annual income does not represent the true inequality in the living standards. This means that the distribution of income over the life time will be more equal than the income at a specific period.

Economics Concept Introduction

Life-cycle theory: Life cycle theory developed by Franco Modigliani and Richard Brumberg relates to the spending and saving habits of an individual to the course of their life time.

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Answer 2

Question

Chapter 15, Problem 1QP

To determine

The most equally distributed type of income.

Expert Solution & Answer

Explanation of Solution

Yes, the life cycle income is more equally distributed than the transitory income. This is because when an individual joins an employment after studies, the initial level of salary will be lower and as and when he moves on with experience, his salary also increases. It will reflect on the annual income, which is lower at the younger periods and higher in the elder periods. Thus, people have temporarily high or low income, and this means that the annual income does not represent the true inequality in the living standards. This means that the distribution of income over the life time will be more equal than the income at a specific period.

Economics Concept Introduction

Life-cycle theory: Life cycle theory developed by Franco Modigliani and Richard Brumberg relates to the spending and saving habits of an individual to the course of their life time.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 15, Problem 1QP

To determine

The most equally distributed type of income.

Expert Solution & Answer

Explanation of Solution

Yes, the life cycle income is more equally distributed than the transitory income. This is because when an individual joins an employment after studies, the initial level of salary will be lower and as and when he moves on with experience, his salary also increases. It will reflect on the annual income, which is lower at the younger periods and higher in the elder periods. Thus, people have temporarily high or low income, and this means that the annual income does not represent the true inequality in the living standards. This means that the distribution of income over the life time will be more equal than the income at a specific period.

Economics Concept Introduction

Life-cycle theory: Life cycle theory developed by Franco Modigliani and Richard Brumberg relates to the spending and saving habits of an individual to the course of their life time.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 15, Problem 1QP

To determine

The most equally distributed type of income.

Expert Solution & Answer

Explanation of Solution

Yes, the life cycle income is more equally distributed than the transitory income. This is because when an individual joins an employment after studies, the initial level of salary will be lower and as and when he moves on with experience, his salary also increases. It will reflect on the annual income, which is lower at the younger periods and higher in the elder periods. Thus, people have temporarily high or low income, and this means that the annual income does not represent the true inequality in the living standards. This means that the distribution of income over the life time will be more equal than the income at a specific period.

Economics Concept Introduction

Life-cycle theory: Life cycle theory developed by Franco Modigliani and Richard Brumberg relates to the spending and saving habits of an individual to the course of their life time.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 15, Problem 1QP

To determine

The most equally distributed type of income.

Expert Solution & Answer

Explanation of Solution

Yes, the life cycle income is more equally distributed than the transitory income. This is because when an individual joins an employment after studies, the initial level of salary will be lower and as and when he moves on with experience, his salary also increases. It will reflect on the annual income, which is lower at the younger periods and higher in the elder periods. Thus, people have temporarily high or low income, and this means that the annual income does not represent the true inequality in the living standards. This means that the distribution of income over the life time will be more equal than the income at a specific period.

Economics Concept Introduction

Life-cycle theory: Life cycle theory developed by Franco Modigliani and Richard Brumberg relates to the spending and saving habits of an individual to the course of their life time.

Answer 6

Chapter 15, Problem 1QP

To determine

The most equally distributed type of income.

Expert Solution & Answer

Explanation of Solution

Yes, the life cycle income is more equally distributed than the transitory income. This is because when an individual joins an employment after studies, the initial level of salary will be lower and as and when he moves on with experience, his salary also increases. It will reflect on the annual income, which is lower at the younger periods and higher in the elder periods. Thus, people have temporarily high or low income, and this means that the annual income does not represent the true inequality in the living standards. This means that the distribution of income over the life time will be more equal than the income at a specific period.

Economics Concept Introduction

Life-cycle theory: Life cycle theory developed by Franco Modigliani and Richard Brumberg relates to the spending and saving habits of an individual to the course of their life time.

Answer 7

Chapter 15, Problem 1QP

To determine

The most equally distributed type of income.

Answer 8

Expert Solution & Answer

Explanation of Solution

Yes, the life cycle income is more equally distributed than the transitory income. This is because when an individual joins an employment after studies, the initial level of salary will be lower and as and when he moves on with experience, his salary also increases. It will reflect on the annual income, which is lower at the younger periods and higher in the elder periods. Thus, people have temporarily high or low income, and this means that the annual income does not represent the true inequality in the living standards. This means that the distribution of income over the life time will be more equal than the income at a specific period.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Life-cycle theory: Life cycle theory developed by Franco Modigliani and Richard Brumberg relates to the spending and saving habits of an individual to the course of their life time.

Answer 12

Ch. 15 - Prob. 1QP Ch. 15 - Prob. 2QP Ch. 15 - Prob. 3QP Ch. 15 - Prob. 4QP Ch. 15 - Prob. 5QP Ch. 15 - Prob. 6QP Ch. 15 - Prob. 7QP Ch. 15 - Prob. 8QP Ch. 15 - Prob. 9QP Ch. 15 - Prob. 10QP

The most equally distributed type of income.

The most equally distributed type of income.

Explanation of Solution

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