Fiat money has value because the government has declared that it can be exchanged for gold or silver.

Name: Fiat money has value because the government has declared that it can be exchanged for gold or silver.
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Question

Quizplus · Accepted Answer

Fiat money does not have intrinsic value and is not backed by a commodity like gold or silver. Its value comes from the government's declaration or promise to accept it as payment for goods and services and its use as a legal tender in the economy.

Fiat Money Has Value Because the Government Has Declared That