An Increase in Capital Formation That Expands Long-Run Aggregate Supply

question 13

Multiple Choice

An increase in capital formation that expands long-run aggregate supply will

• A) increase output and decrease prices.
• B) increase both output and prices.
• C) decrease both output and prices.
• D) decrease output and increase prices.

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Definitions:

Rectus Abdominis

The rectus abdominis is a long muscle that extends along the front of the abdomen, playing a key role in maintaining posture and facilitating movement.

Transversus Abdominis

The deepest layer of abdominal muscles, crucial for core stability and posture.

External Abdominal Oblique

A large muscle located on the side and front of the abdomen, playing a key role in rotational movements and supporting abdominal viscera.

Erector Spinae

A group of muscles and tendons which run nearly the entire length of the spine, helping to extend and straighten the back.