An increase in the amount of physical capital will cause A) an increa
An increase in the amount of physical capital will cause
A) an increase in both aggregate demand and real GDP, but have no effect on the price level.
B) an increase in both aggregate supply and real GDP, but have no effect on the price level.
C) aggregate demand and aggregate supply to increase by the same amounts, causing real GDP to increase and the price level to remain constant.
D) an increase in both aggregate supply and real GDP and a reduction in the price level.
ANSWER
D
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