One issue with using income to measure standard of living and poverty is that th

Question

One issue with using income to measure standard of living and poverty is that the income people earn does not always match the consumption An example of this is 0 A, the progessive tax system which says people pay less taxes as their income increases. Is and households 0 B. governments create transfers, such as food stamps to low income households that allow them an opportunity to consume more than their income indicates. firms will provide end of year bonuses to their workers when profit exceeds what the company was originally expecting from their sales. the availability of low income workers to simply supplement their income with government created jobs. ° C. 0 D.

Explanation / Answer

B is the correct option

Reason

For poorer people, numerous welfare programmes are to help them to have some consumption, this is not reflected in the income distribution.

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