The IS curve has a positive slope because a(n) __________ in the interest rate leads to a(n) __________ in desired investment and this leads to a decrease in GDP

Which of the following could cause nominal GDP to increase, but real GDP to decrease?

A) The price level falls and the quantity of final goods and services produced falls. B) The price level falls and the quantity of final goods and services produced rises. C) The price level rises and the quantity of final goods and services produced falls. D) The price level rises and the quantity of final goods and services produced rises.

When nominal interest rates increase, the opportunity cost of holding money will ________, and the quantity of money demanded by households and firms will ________

A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease