Flat money is any type of currency that is declared legal by the government.
<u>Explanation:</u>
For example, Flat money is paper currency or the coins. The fiat money is backed up by the government and its value is stated by the government itself.
The other form of money is the representative money that is backed up by the personal things.
Like, cheque is representative money backed up by individual’s bank balance. So the authority behind the fiat money is the government of any nation.
Fiat money is government-issued currency that is not backed by a physical commodity, such as gold or silver, but rather by the government that issued it. The value of fiat money is derived from the relationship between supply and demand and the stability of the issuing government, rather than the worth of a commodity backing it as is the case for commodity money. Most modern paper currencies are fiat currencies, including the U.S. dollar, the euro and other major global currencies.