This helps to achieve macroeconomic goals such as economic growth and higher employment, but may conflict with the 2% inflation rate since demand-pull pressures increase. However, in the long run, the increase in investments in labour and capital may increase the productivity of branded coffee firms -> unit labour costs fall -> outward shift in the LRAS curve from LRAS1 to LRAS2 -> increases GDP from y1 to y2 -> reduced GPL from p1 to p2 -> could counteract initial rise in GPL so that the 2% inflation rate is not compromised.
Impacts will depend on the value of the multiplier, where the higher this is (larger spare capacity, higher MPC, lower MPS, MPM and MPT), the greater the outward shift in AD will be, thus the more GPL and GDP rise.
Impacts also depend on the elasticity of the AS curve, where if more elastic, GDP can increase more while GPL rises less, but if more inelastic then GPL increases more, while GDP rises less. Thus, the more elastic the AS curve is, the less this may conflict with the 2% inflation rate.
Investments in capital and labour by branded coffee firms may not increase, if business confidence is low (likely to be the case due to uncertainty surrounding Brexit and Trump's Tariffs), if business costs are high/profits are low (likely due to the recent rise in corporation tax to 25%, increased employer national insurance contributions, rise in the minimum wage, overall highest tax burden in 70 years) or if interest rates are high (which they are at around 4.25%) which holds back incentives to borrow (high borrowing costs and high returns on savings) to fund investment projects. Moreover, even if investments increase, the impacts of this will take a long time to set in, since there is a time lag for investment projects to be completed and new workers to be trained.