Economics of Macro Issues 7th Edition by Roger LeRoy Miller,Daniel Benjamin

Exercise 4

The rule of 70 states that if something is growing at a rate of R percent per year, its value will double in 70/R years. Suppose the inflation rate becomes 5 percent per year in the United States. How long will it take for the price level to double? How long will it take for the real value of the current stock of federal debt to be cut in half? Show your calculations.