Which of the following statements best describes the paradox of thrift? Households increase savings during recessions, which causes consumption to fall, aggregate expenditures to fall, and may possibly lead to or make worse a recession. Households substitute to thrifty, lower-priced items during a recession, causing aggregate expenditures to fall. Households decrease saving during a recession, reducing opportunities for business investment. Unlike most retailers, thrift stores tend to have increased profits when the economy is in a recession. Why are some economists skeptical of the paradox of thrift? Following its logic, interest rates should rise as the supply of loanable funds decreases, which would also cause business investment to decrease. Following its logic, interest rates should fall as the supply of loanable funds increases, which would cause business investment to increase and offset the reduction in consumption spending. Following its logic, other stores will mimic the success of thrift stores by lowering prices and discounting merchandise. Following its logic, government spending will increase to compensate for the reduction in consumer saving during a recession.