Question

question 15
what is the impact of increasing capital investment on real gdp?
it reduces consumer spending
it decreases productivity
it increases the capacity for production
it limits technological advancements

Explanation:

Increasing capital investment allows firms to buy more machinery, build more factories etc. This expands their production - related resources, thus increasing the capacity for production. Higher production capacity generally leads to higher real GDP. The other options are incorrect as capital investment usually doesn't reduce consumer spending, doesn't decrease productivity (in fact, it often increases it), and doesn't limit technological advancements (it can facilitate them).

Answer:

It increases the capacity for production