Question: Consider the AD/AS framework seen in lectures. Say that, given the recent data on jobs added to the economy, firms feel confident that the economy

Consider the AD/AS framework seen in lectures. Say that, given the recent data on jobs added to the economy, firms feel confident that the economy will improve, and as a result investment in the economy increases. Compared to the initial equilibrium, in thelong runequilibrium

Prices rise, the nominal interest rate falls.

Prices and the nominal interest rate fall.

None of the other answers.

Prices and the nominal interest rate rise.

Prices fall, the nominal interest rate rises.

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