Explain the economic costs of hyperinflation. What will be an ideal ...

Author Question: Explain the economic costs of hyperinflation. What will be an ideal ... (Read 47 times)

jCorn1234

Hero Member
Posts: 545

on: Jun 30, 2018

Explain the economic costs of hyperinflation.

What will be an ideal response?

Question 2

Explain seignorage.

What will be an ideal response?

Meganchabluk

Sr. Member
Posts: 301

Reply #1 on: Jun 30, 2018

Answer to Question 1

The transaction system works less and less well. Price signals become less and less useful. Swings in the inflation rate become larger.

Answer to Question 2

The real revenue from money creation is called seignorage. It is equal to the money creation divided by the price level.

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