Passage: The 'paradox of thrift' suggests that during an economic recession, individuals' attempts to save more, while beneficial at a micro-level, can collectively depress demand, leading to a further slowdown in economic growth. This phenomenon highlights how individual rationality can lead to collective irrationality, complicating policymaking during downturns. Which of the following statements, if true, would best support the existence of the 'paradox of thrift'?
✓ Correct Answer: Option B
The paradox states increased savings lead to economic slowdown. If increased savings are observed before declines in GDP (a measure of economic growth), it directly supports the causal link described by the paradox.