Not enough information to give the answer here. You haven't said why you think there should be more whitespace in the result tree than there is.
Whitespace in the result tree comes from one of three places: from nodes copied from the source document, from text written by the stylesheet, and from use of indent="yes". Your stylesheet uses indent="no", and from what you've shown us doesn't generate any whitespace text nodes. You haven't shown us the input, so we can't see what's being copied from there.
indent="yes" will never generate whitespace adjacent to existing text. If you want newlines before and after "Answer the following question" then they must either be in the original source, or your stylesheet must add them.
Author, XSLT Programmer's Reference and XPath 2.0 Programmer's Reference