ECON MACRO
5th Edition
ISBN: 9781337430401
Author: William A. McEachern
Publisher: Cengage Limited
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Question
Chapter 13, Problem 1.5P
To determine
The meaning of the statement −“the better fiat money assists as a store of value, the more acceptable it is”. Also, the reason behind people losingconfidence in money.
Concept Introduction:Fiat money is currency that a government has declared to be legal tender, but it is not backed by a physical commodity. Fiat money only has value because the government maintains that value, or because two parties agree on said value. A store of value is that function of money which can be saved, retrieved and exchanged at a later time, and be predictably useful when retrieved
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Students have asked these similar questions
Which of the following statements represent a use of money that is not
consistent with its definition?
"I got some money at the ATM with my debit card,"
"I just used my credit card as money to buy a new television."
"I wrote a check on my deposit account to pay for dental services."
"I will accept either currency or gold as money for the purchase of my house."
What is the supply, demand, and price of money?
What is fiat money? Give some examples.
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Similar questions
- What is the role of money for Adam Smith?arrow_forwardHow does the existence of money simplify the process of buying and selling?arrow_forwardThroughout history, all sorts of interesting things have been used as money, including fresh fish and cattle. Fresh fish is not an effective form of money. What essential characteristic of money does fresh fish lack that most makes it ineffective?arrow_forward
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