Question

Saving is both a virtue as well as vice. Explain How?

Answer 1

• At the macro level saving is a virtue. But it may be vice at the macro level. If an individual saves more, he accumulates more wealth. It enhances his ability to earn more. 
• But at the macro level, if everyone starts saving more, demand for goods and services may fall. It will adversely impact the inducement may shrink, driving the economy into state of depression.