What is the difference between face value and book value?

Answer 1

The face value of any coin or stamp is simply its denomination. The face value of a $5 bill is $5, the face value of a 44¢ stamp is 44¢, etc.

The term "book value" is a bit soft when referring to collectibles, because collectibles can have multiple values:

First, there's the auction value, the price that an item will sell for when people are bidding against each other for a specific item. Usually this applies only to very scarce items where there isn't a broad market for them.

Next there's the retail value. That's easier to determine when there are many examples of a particular item because the marketplace tends to level out what people are willing to pay. For example, the retail value of a Lincoln cent with a particular date, mint mark, variety, and condition (e.g. a 1909-S VDB) may be about $750 because. while they're scarce, there are still enough of them that the amounts people are willing to pay start averaging out; that's the way an open market operates.

Then there's the wholesale or buyer value. A dealer who sells a collectible item needs to make a profit. That means when they buy an item for later resale, they'll pay less than the price they sell it for (i.e. the retail price).

Finally, at least for coins there's what's called their intrinsic value, metal value, or melt value. That's because most coins are made of metals that themselves are bought and sold on the open market. Coins made out of common metals such as copper, zinc, or nickel have very low intrinsic values. However older coins made of gold or silver can be worth much more than their face value because those metals have gone way up in price since the time the coins were minted. For example, as of 04/2011 silver is about $41 an ounce on the spot market so an older silver dollar that contains roughly 0.77 oz of silver would have a melt value in the $30-$32 area. But even here, that's retail - wholesale might be $24 to $27 because again the dealer has to make a profit!