Question

In the Economic Organization of a P.O.W. Camp, what kind of currency best describes the paper currency the prisoners made? Fiat, because it was backed by another fiat currency. Fiat, because it wasn't made up of anything that valuable. Commodity, because it was backed by a valuable good. Commodity, because paper was a valuable commodity in camp.

Answer 1

Answer: Commodity, because it was backed by a valuable good.

Explanation:

In the Prisoner of War camp in question, the prisoners had come up with a trade system where they used paper money that was backed by cigarettes. This made that paper money a commodity because it was backed by a valuable good in the camp which was cigarettes.

Commodity money such as this one used to be widely used by nations as their currency would be backed by valuable metals such as gold and silver.