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Q. If all the people of the economy increase the proportion of income they save (i.e. if the mps of the economy increases) the total value of savings in the economy will not increase - it will either decline or remain unchanged. This is popularly called as:
Answer: Paradox of thrift
Notes: The paradox of thrift is a paradox of economics. The paradox states that an increase in autonomous saving leads to a decrease in aggregate demand and thus a decrease in gross output which will lower the total saving.

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