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Nickels are called nickels because they are made from the element nickel.

Not exactly. Nickels are only 25% nickel. The rest is copper.

At one time the US issued 5¢ coins in both silver alloy and copper-nickel. There were also silver and copper-nickel 3¢ coins that were used for buying postage stamps, among other things.

To distinguish them people used terms like "3 cents silver" and "3 cents nickel". The 3-cent denomination was discontinued due to its limited usefulness, but the terms stuck around for 5-cent coins. Silver 5-cent pieces were discontinued about the same time, and the term morphed to "5-cent nickels" and eventually, just "nickels"

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