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.
Correct Answer:

Verified
Correct Answer:
Verified
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