a. The paradox of thrift is based on a circular flow of the economy in which current spending drives future spending. Explain the paradox of thrift. b. Why do you think households’ purchase of new...

a. The paradox of thrift is based on a circular flow of the economy in which current spending drives future spending. Explain the paradox of thrift. b. Why do you think households’ purchase of new housing is included in the investment components of GDP rather than the consumption component? c. What is the difference between GDP and GNP? Which one is the better measure of income? Why?