Multiple Choice
An increase in the capital stock that increases the amount of capital per worker:
A) shifts potential output and the aggregate supply curve to the left.
B) makes labour more productive, so there is an increase in potential output and long-run supply.
C) raises the inflation rate, given aggregate demand.
D) all the above.
Correct Answer:
Verified
Related Questions
Q1: With flexible wages and prices:
A) as price
Q2: The long-run aggregate supply curve:
A) is vertical
Q4: Potential output is determined by all the
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