Practice question

A Paradox of thrift refers to a situation in which people tend to save more money, thereby leading to a fall in the savings of the economy as a whole B When everyone increases his/her saving - income proportion i.e. MPS (s), then, the aggregate demand will fall as consumption decreases. C This concept was suggested by Keynes wherein increased saving at individual levels will gradually lead to the slowdown of economy in terms of circular flow of income. D All of the above Correct