What is fiat money? Why is fiat money important in the United States today?
What will be an ideal response?
Fiat (from the Latin for “Let it be done”) money is money that is decreed to be acceptable as payment, regardless of whether or not there is backing by gold, silver, or other precious metals. Money in circulation in the United States (and most other modern economies) today is almost entirely fiat money. Fiat money is valuable only because people believe it is exchangeable for goods and services. It has no intrinsic value.
You might also like to view...
The primary component of photochemical smog is
a. lead c. sulfur dioxide b. tropospheric ozone d. carbon dioxide
Refer to Figure 2-12. Which country has a comparative advantage in the production of milk?
A) They have equal productive abilities. B) Bora Bora C) Tahiti D) neither country
____ are defined as costs which are incurred regardless of the alternative action chosen in a decision-making problem
a. Opportunity costs b. Marginal costs c. Relevant costs d. Sunk costs e. None of the above
If an increase in government spending causes an increase in government borrowing, this could induce
A. an increase in interest rates, which would cause private domestic investment to fall. B. an increase in interest rates, which would cause private domestic investment to rise. C. an increase in interest rates but no effect on private domestic investment. D. a decrease in interest rates, which would cause private domestic investment to rise.