1.)

In an opinion column in the New York Times, Mark Rank of WashingtonUniversity, St. Louis described research he carried out with Thomas A. Hirschl of Cornell University. They tracked individuals between the ages of 25 and 60 over a44-year period and found that"39 percent of Americans will spend a year in the top 5 percent of the incomedistribution, 56 percent will find themselves in the top 10percent, and a whopping 73 percent will spend a year in the top 20 percent of the incomedistribution." Rank argues that"this information casts serious doubt on the notion of a rigid class structure in the United States based uponincome."

Source: Mark R.Rank, "From Rags to Riches toRags," New York Times, April18, 2014.

a. What does Rank mean by a"rigid class structure . . . based uponincome"?

A.

It implies that there is significant income mobility in the United States.

B.

It implies that most people who start in a lower income quintile will eventually end up in a higher income quintile.

C.

It implies that the same people are likely to stay within a certain income percentile group for a long period of time.

D.

It implies that age is a more important factor in determining income distribution than previous research indicates.

2.)

Why might looking at the distribution of income in a particular year give a different picture of the state of inequality in the United States than does longitudinal data that tracks individuals overtime?

A.

Longitudinal data do not take into account incomemobility, whereas the income distribution in a particular year will show how people have moved up and down the income distribution.

B.

The income distribution in a particular year does not take into account incomemobility, whereas longitudinal data show how people may have moved up and down the income distribution over time.

C.

The income distribution in a particular year accounts for the effects of taxes onincome, whereas longitudinal data fail to evaluate taxes and their effect on income.

D.

The income distribution in a particular year assumes that incomes areconstant, so it will overstate the level of inequality compared to longitudinal data.