The term "fiat money" means money backed by the credit of the issuer, and has no intrinsic value.
fiat money has only a single use as a medium of exchange
The most important requirement for money to be medium of exchange is the value of money.
Laws set by the government give Fiat money its value as a medium of exchange. Unlike traditional money or currency, it has no good which act as a medium to back it up.
Money has three functions, being a: 1) store of value; 2) unit of account; 3) medium of exchange. The first, a store of value, implies that money maintains and stores its value over time - unlike many other mediums of exchange, which can depreciate. Money is intended to be storeable, retrievable, and reuseable as a medium of exchange itself. Therefore, being a store of value does not mean that money can be used to measure the value of other commodities - that is its third function, medium of exchange.
The term "fiat money" means money backed by the credit of the issuer, and has no intrinsic value.
fiat money has only a single use as a medium of exchange
Commodity money is a good that can be used as a medium of exchange or for some other purpose.
The most important requirement for money to be medium of exchange is the value of money.
Laws set by the government give Fiat money its value as a medium of exchange. Unlike traditional money or currency, it has no good which act as a medium to back it up.
Which of the following is not a characteristic of money? a. A medium of exchange b. A store of value c. A unit of account d. A source of barter Clear selection
Yes, money is a generally accepted medium of exchange, which facilitates the trade of things of value, measurable in monetary terms. Those are just two of the functions of money.
something that people agree has specific value
Fiat money has only a single use as a medium of exchange
Money has three functions, being a: 1) store of value; 2) unit of account; 3) medium of exchange. The first, a store of value, implies that money maintains and stores its value over time - unlike many other mediums of exchange, which can depreciate. Money is intended to be storeable, retrievable, and reuseable as a medium of exchange itself. Therefore, being a store of value does not mean that money can be used to measure the value of other commodities - that is its third function, medium of exchange.
commodity money is a good that can be used as a medium of exchange or for some other purpose
Fiat money has only a single use as a medium of exchange