How does an increase in investment in capital goods typically affect long-run supply in an economy?

When a country invests more in capital goods, like machinery and buildings, it helps businesses produce more goods and services over time. This increase in production capacity means that the economy can supply more products to meet consumer demand. As businesses become more efficient and can produce at a larger scale, the overall supply in the economy grows, leading to a shift in the long-run supply curve to the right. For example, if a factory buys new machines that operate faster, it can make more toys in a day, allowing them to sell more toys in the market. This increase in long-run supply often leads to lower prices and more choices for consumers.