What is the effect of an increase in investment? Question content area bottom Part 1 When investment increases, _______. A. aggregate supply increases. The increase in aggregate supply is greater than the increase in investment because capital increases, which increases potential GDP B. aggregate demand increases by an amount equal to the increase in investment C. aggregate demand increases and aggregate supply increases D. aggregate demand increases and income increases. The increase in income induces an increase in consumption expenditure so aggregate demand increases by more than the initial increase in investment