Which of the Following Most Clearly States the "Paradox of Thrift

question 94

Multiple Choice

Which of the following most clearly states the "paradox of thrift"?

• A) If households simultaneously attempt to increase their savings, the result may be a reduction in demand, output, and total savings.
• B) A strong, healthy economy can be achieved if most households are heavily in debt.
• C) A high savings rate will provide the funds for investment, which is a driving force of long-term economic growth.
• D) A reduction in savings and an increase in consumption will expand output and employment.

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Relating to the essential substance or elements of a thing; concerning the merits of a case, as opposed to procedural aspects.

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Guidelines or protocols established to dictate the process by which legal proceedings or governmental policies are carried out.

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