26) E

1 – Correct
1 is correct- the income increase of the poor is less than it could have been as seen in data

2 – Correct
2 could definitely be correct and we have already explored the idea that the incomes at the top end may have increased more than those at the bottom end

3 – Correct
3 could also increase the Fair-E coefficient while taxes and benefits change for the poor

Since all 3 statements are correct, E is the answer.

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