Fiat money is any money that Group of answer choices a. Earns interest when deposits in banks. b. Is money because the government says so and the people accept it. c. Has a greater face value than its purchasing power. d. Exists in the form of coin or currency. e. Is issued by the Department of the Treasury.

Fiat money is any money that Group of answer choices a. Earns interest when deposits in banks. b. Is money because the government says so and the people accept it. c. Has a greater face value than its purchasing power. d. Exists in the form of coin or currency. e. Is issued by the Department of the Treasury.

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter13: Money And The Financial System

Section: Chapter Questions

Problem 1.5P

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Question

24. Fiat money is any money that

Group of answer choices

a. Earns interest when deposits in banks.

b. Is money because the government says so and the people accept it.

c. Has a greater face value than its purchasing power.

d. Exists in the form of coin or currency.

e. Is issued by the Department of the Treasury.

Definition Definition Value of one unit of currency in terms of goods and services. Purchasing power refers to the ability of money to purchase goods and services at a particular point of time. As price levels in the economy increase, the purchasing power of one unit of currency decreases and vice versa.

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