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A three year old would not have the ability to form that concept, let alone verbalize it.
Age two to five years old
Young children are interested in the idea of death, for example in birds, insects and animals. They can begin to use the word 'dead' and develop an awareness that this is different to being alive. However, children of this age do not understand abstract concepts like 'forever' and cannot grasp that death is permanent.
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Kids talk about all kinds of stuff they have no concept of. I could see this happening with a kid just babbling something to that effect and the mother taking it as some profound wisdom instead of as just another case of dumb kid babble
The quote doesn't say anything about forever tho. The kid is just figuring out that death happens to people and wolves, but not to words and books. The parent is the one pretending that the kid's making some profound statement about the permanence of ideas.