Money whose value derives entirely from its official status as a means of exchange is known as:

Question

BlackTom AI · Accepted Answer

This question asks about a type of money defined by its value being derived from official status as a medium of exchange.
Option 1: commodity-backed money. This relies on a redeemable value tied to a commodity (such as gold or silver) held in reserve, so its worth comes partly from that backing rather than solely from government decree.
Option 2: commodity money. This type has intrinsic or material value itself (like gold coins), so its value is not solely the official status but also its inherent worth, which conflicts with the idea of value arising only from being an accepted medium of exchange.
Option 3: fiat money. This is money whose value is established by government decree and acceptance for payments, with no intrinsic commodity value backing it. Its worth depends entirely on the official status as a means of exchange, which matches the definition in the question.
Option 4: bank reserves. Bank reserves are central bank liabilities held by commercial banks and are not themselves the circulating medium used by the public; they do not describe money whose value comes from its status as a means of exchange in everyday transactions.
In summary, only fiat money fits the description of deriving its value entirely from official status rather than intrinsic value or backing by a commodity, while the other options involve some form of intrinsic value, commodity backing, or institutional role that does not align with the given definition.

Money whose value derives entirely from its official status as a means of exchange is known as:

View Explanation

Log in for full answers

Similar Questions

Fiat money has

Fiat money has value because ______. Select all that apply.

位置16的问题 Fiat currency is backed by a physical commodity like gold or silver.TrueFalse

Part 1Which of the following is a disadvantage of using fiat money LOADING... ?Part 2 A. Public authorities may be tempted to produce too much of it B. Fiat money is not easily divisible or suitable for small purchases C. Fiat money is not portable or widely accepted

Part 1Which of the following is a disadvantage of using fiat money LOADING... ?Part 2 A. Fiat money is not portable or widely accepted B. Fiat money is not easily divisible or suitable for small purchases C. Public authorities may be tempted to produce too much of it

The word "fiat" is

93. Which of the following does not explain what backs the money supply in the United States? A. It is backed by gold. B. It is widely accepted in transactions. C. It is designated "legal tender" by the federal government. D. It is relatively scarce.

More Practical Tools for Students Powered by AI Study Helper

Homework AI Solver

Stylized AI Paper Writer

Plagiarism Checker Assistant

Citation AI Academic Writing Tool

In-Class Translation Assistant

AI Note Generator

AI Quiz Answers

Past Exam Questions from University Test Bank

Smart Practice Assistant

Adaptive Practice

Making Your Study Simpler

Money whose value derives entirely from its official status as a means of exchange is known as:

View Explanation

Log in for full answers

Similar Questions

Fiat money has

Fiat money has value because ______. Select all that apply.

位置16的问题 Fiat currency is backed by a physical commodity like gold or silver.TrueFalse

Part 1Which of the following is a disadvantage of using fiat money LOADING... ​?Part 2 A. Public authorities may be tempted to produce too much of it B. Fiat money is not easily divisible or suitable for small purchases C. Fiat money is not portable or widely accepted

Part 1Which of the following is a disadvantage of using fiat money LOADING... ​?Part 2 A. Fiat money is not portable or widely accepted B. Fiat money is not easily divisible or suitable for small purchases C. Public authorities may be tempted to produce too much of it

The word "fiat" is

93. Which of the following does not explain what backs the money supply in the United States? A. It is backed by gold. B. It is widely accepted in transactions. C. It is designated "legal tender" by the federal government. D. It is relatively scarce.

More Practical Tools for Students Powered by AI Study Helper

Making Your Study Simpler

Part 1Which of the following is a disadvantage of using fiat money LOADING... ?Part 2 A. Public authorities may be tempted to produce too much of it B. Fiat money is not easily divisible or suitable for small purchases C. Fiat money is not portable or widely accepted

Part 1Which of the following is a disadvantage of using fiat money LOADING... ?Part 2 A. Fiat money is not portable or widely accepted B. Fiat money is not easily divisible or suitable for small purchases C. Public authorities may be tempted to produce too much of it