When aggregate planned expenditure ________ real GDP, there are ...

[viki]

When aggregate planned expenditure ________ real GDP, there are unplanned ________ in inventories, and firms ________ production, therefore decreasing real GDP.
 
  A) exceeds; decreases; decrease
  B) exceeds; increases; increase
  C) is less than; increases; decrease
  D) is less than; increases; increase
  E) is less than; decreases; decrease

Question 2

Assume the First Bank of Townsville makes a loan of 2,500. This loan will
 
  A) increase the First Bank of Townville's liabilities at the Fed.
  B) have no change on the quantity of money, just its composition.
  C) increase the First Bank of Townville's reserves.
  D) increase the quantity of money initially by 2,500.
  E) decrease the quantity of money initially by 2,500.

[bblaney]

Answer to Question 1

C

Answer to Question 2

D