Assume That the Real Interest Rate Is 4%,the Expected Rate

question 7

Multiple Choice

Assume that the real interest rate is 4%,the expected rate of inflation is 8%,and the nominal interest rate is 12%.The monetary base equals $50 billion.The real seignorage revenue collected by the government would equal

• A)$4 billion.
• B)$6 billion.
• C)$8 billion.
• D)$12 billion.

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