In the basic AD/AS macro model, the "paradox of thrift" is only a short- run phenomenon because
A)consumers base their consumption expenditures only on their lifetime income.
B)the marginal propensity to consume is fixed in the long run.
C)savings are transformed into expenditures in the long run.
D)in the long run output is determined by potential output.
E)consumers exhibit cyclical consumption behaviour.

Question

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The Answer of In the basic AD/AS macro model, the "paradox of thrift" is only a short- run phenomenon because
A)consumers base their consumption expenditures only on their lifetime income.
B)the marginal propensity to consume is fixed in the long run.
C)savings are transformed into expenditures in the long run.
D)in the long run output is determined by potential output.
E)consumers exhibit cyclical consumption behaviour.

In the Basic AD/AS Macro Model, the "Paradox of Thrift