The Paradox of Thrift Happens When Many People Save More

question 101

True/False

The paradox of thrift happens when many people save more and spend less, so businesses lower prices.

---

Definitions:

Quantity Sold

The total number of units of a product or service purchased by customers over a specified period.

Tax

A compulsory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization.

Consumer Surplus

The imbalance between the total budget consumers are willing to allocate for a product or service and the actual spending.

Consumer Surplus

The separation between the ideal amount consumers are willing to spend on a service or product and their real expenditures.