Question

Fiat money has :
A. a great intrinsic value that is independent of its use as money.
B. little to no intrinsic value and is authorized by the central bank or governmental body.
C. ​value, because it can be redeemed for gold by the central bank.
D. little to no intrinsic value but is backed by the quantity of gold held by the central bank.

Answer 1

Answer: Option (B)

Explanation:

Fiat money is referred to as the currency which tends to have no intrinsic value and thus has been further entrenched as money. This process is often carried out by the federal government. This particular type of money does not tend to have the use of value, and only has the value since the authority i.e. the government tends to maintains its value.