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Solutior What does the paradox of thrilt refer to Select one a

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1. Solutior What does the paradox of thrilt refer to Select one a. Decreases in government spending can cause decreases in net laxes b. Decreases in the marginal propensity to consume (MPC) can cause decreases sings c. Decreases in income can cause decreases in imports d. Decreases in autonomous consumption can cause decreases in future income

2. Selim has no income in period 1 (consumption now) and an income of 1800£ in period 2 (consumption later). The current interest rate is 20% (r=0.2) on consumer loans. Based on this information, answer the following questions a. What is the maximum amount that Selim can borrow to spend in period 1? Explain your answer. b. Can he spend 600 in period 2 and borrow 1000 in period 1?