178
MACROECONOMICS
(point F in Figure 6.9 for
s
=
s
0
), and as a combination of a lower real money
supply and a higher growth rate of money (point G in Figure 6.9 for
s
=
s
0
).
Accordingly, the graph for seigniorage in Figure 6.9(A) is downward sloping.
19
A higher level of seigniorage,
s
s
0
, is represented in this graph by combi-
nations of real money supply and growth rate of money to the right of
s
0
.
In this
way various levels of seigniorage
s
0
, s
1
, s
2
, …
can be represented by downward-
sloping curves, as depicted in Figure 6.9(A). The real money demand function
is depicted by the curve DD. ...
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