Solved

Real Money Demand in the Economy Is Given by L

Question 1

Multiple Choice

Real money demand in the economy is given by L = 0.3Y - 600 i,where Y is real income and i is the nominal interest rate.In equilibrium,real money demand L equals real money supply M/P.Suppose that Y equals 2000 and the real interest rate is 5%.What is the maximum amount of seignorage revenue?


A) 132,000
B) 135,375
C) 138,000
D) 141,125

Correct Answer:

verifed

Verified

Related Questions

Q3: The primary deficit is<br>A)the amount by which

Q4: Because of automatic stabilizers,in recessions the government

Q5: Which of the following would be most

Q6: Which of the following can explain the

Q7: Assume that the real interest rate is

Q8: The type of tax receipts that has

Q11: The main difference between the Keynesian and

Q13: At the beginning of year one,there is

Q25: The deficit is<br>A)the amount by which government

Q82: The marginal tax rate is<br>A)the fraction of