Suppose a Developing Country Receives More Machinery and Capital Equipment

question 58

Multiple Choice

Suppose a developing country receives more machinery and capital equipment as foreign entrepreneurs increase the amount of investment in the economy. As a result, the:

• A)long-run aggregate supply curve will shift to the right.
• B)long-run aggregate supply curve will shift to the left.
• C)economy will move up along the long-run aggregate supply curve.
• D)economy will move down along the long-run aggregate supply curve.

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Definitions:

Percent Increase

The proportionate growth of a value over time, expressed as a percentage of the initial amount.

Successive Years

A term used to describe years that follow one after another without interruption.

Loan

A borrowed amount of money that is to be repaid along with interest.

Investment

The distribution of funds or other resources with the aim of earning revenue or profit.