All categories

2 years ago

What is the difference between commodity money and fiat money?

Business

1 answer:

Eva8 [605]2 years ago

6 0

Answer:

Please see answer in the explanation below

Explanation:

Commodity money can be defined as money that its value comes from the commodity with which it was made. That is, commodity money is money that is gotten as a result of the material from which the money was made. Examples of these materials are silver, gold, etc. These materials have intrinsic value on their own as the materials have a worth of their own before being used to make currency.

Fiat money on the other hand is defined as money that is declared as the legal tender by the government. That means that fiat money is the money that is acceptable as a medium of exchange for goods and services as issued by the government. Fiat money does not have intrinsic value.

Cheers.

You might be interested in

A Regional Sales Manager's (RSM) direct reports are frequently added as sales team members for other sales representatives' oppo

Gre4nikov [31]

It’s c because I did it before

3 0

2 years ago

Suppose the economy only produces three goods: bread, laptops, and movies. Calculate the CPI of 2008, using 2004 as the base yea

arsen [322]

Answer:

Most of the question is missing, so I looked for a similar one and found the attached image.

CPI = (current year price × base year quantity) / (base year price × Base year quantity)

CPI for bread in current year = [($1.50 × 2,000) / ($1 × 2,000)] x 100 = 150

CPI for laptops in current year = [($1,500 × 100) / ($2,000 × 100)] x 100 = 75

CPI for movies in current year = [($7 × 50) / ($5 × 50)] x 100 = 140

CPI for current year = (CPI for bread x weight of bread) + (CPI of laptops x weight of laptops) + (CPI of movies x weight of movies) = (150 x $2,250/$227,530) + (75 x$225,000/$227,530) + (140 x $280/$227,530) = 1.48 + 74.17 + 0.17 =75.82

5 0

2 years ago

The cost of using/borrowing money is reflected in the

spayn [35]

Interest rate? Repayment amounts? Length of time of loan? Smile on the face of the money lender? Might there be a little more to this quesition?

8 0

2 years ago

Because farm products have a low elasticity of demand a small change in output will have

GaryK [48]

<span>Because farm products have a low elasticity of demand a small change in output will have a similar effect on the price. Since the low elasticity of demand directly relates to </span>pricing, when the smaller change in output happens, a smaller drop in profits does as well. The price of the item will decrease to compensate for less products selling.

7 0

2 years ago

For a risk-free return rate of 5%, a market risk premium of 6%, what is the required rate of return for a security with a beta c

adoni [48]

Answer:

14%

Explanation:

required rate of return = risk free rate of return + ( risk premium x beta)

5% + 1.5 x 6% = 14%

3 0

2 years ago

What is the difference between commodity money and fiat​ money?

What is the difference between commodity money and fiat money?