# hw4f06 - Print name Sign name Econ 520 F 06 Section Day and...

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Print name___________________ Sign name _____________________ Section Day and Hour ___________________________ Econ 520 F 06 Homework 4 10/10, 10/12, due 10/13 For full credit, show your calculations on each computational problem. 4.1 (10 homework points) If real money balances are \$800 billion (Year 2006 dollars), and the nominal money stock is expanding at an annual rate of 10%/year, what is the annual rate of seigniorage (in 2006 dollars)? Assume for simplicity that the g overnment directly creates the entire money stock and pays no interest on it: 4.2 (10 homework points) If real money balances are \$800 billion (2006 dollars), what annual rate of expansion of the nominal money stock is required to temporarily meet a seigniorage target of \$160 billion (2006 dollars) per year? Assume for simplicity that the government directly creates the entire money stock and pays no interest on it: 4.3 (10 homework points) If real money balances are \$800 billion (2006dollars), and inflation is 7%/year, what is the annual inflation tax on money balances?

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## This note was uploaded on 07/17/2008 for the course ECON 520 taught by Professor Ogaki during the Fall '07 term at Ohio State.

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hw4f06 - Print name Sign name Econ 520 F 06 Section Day and...

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