Question: ** please use your own words don't copy and paste**** **** please don't use handwriting ***** Q2. What can happen if a firm is poorly

** please use your own words don't copy and paste****

**** please don't use handwriting *****

Q2. What can happen if a firm is poorly managed? (1 mark)

Q3. If the expected inflation rate is 10 percent and the real rate of interest is 4 percent:

  1. Compute the nominal rate of interest. (Hint: use equation 2.1) (0.5 mark)
  2. Briefly differentiate between the nominal and the real rates of interest. (0.5 mark)

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