A bank seeks a 4% real return on its loans and predicts a 4% annual rate of inflation. It should therefore charge a nominal interest rate of

Cole was discussing the market for cocoa beans with his friend John Schmidt

Cole said, "Ever since Venezuela announced that its cocoa harvest was its lowest ever in fifteen years, the price of cocoa beans has been rising and rising and people are buying more and more. I think the demand for cocoa beans must be upward sloping." Is Cole right? Briefly explain why or why not.

By promoting its brand name heavily, the monopolistically competitive firm

A) earns more profit in the long run. B) signals its long-term intention to stay in the industry. C) signals its intention to leave the industry. D) guarantees a short run profit.