Multiple Choice
Which of the following is (are) true regarding the paradox of thrift? I. People intend to save less but their actions actually lead to an increase in savings.
II) For the paradox of thrift to occur, investment must be positively related to income.
III) The increased savings of households leads to more consumption, income, and output, increasing investment and aggregate savings.
A) I and II only
B) II only
C) II and III only
D) I, II and III
Correct Answer:
Verified
Correct Answer:
Verified
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