According to the passage, the Paradox of Thrift states that if everyone in the economy increases the proportion of income they save (increased MPS), the total value of savings in the economy does not increase; it either declines or remains unchanged. This is directly stated in the comprehension passage.
The Paradox of Thrift means :
CUET UG 2023 — Economics Macro
2023mcqeasy
The Paradox of Thrift means :
Official previous-year question
Verified 13 Jul 2026.
Options
- A
If all the people in economy increase the savings of their income, total value of savings doesn't increase, it will either decline or remain unchanged
- B
MPS will decrease
- C
Aggregate demand will increase
- D
Aggregate supply will increase
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