Gresham's Law
A) deals with the theory of regulatory forces in the economy.
B) is the tendency for good money to drive bad money out of circulation.
C) is the tendency for bad money to drive good money out of circulation.
D) was passed in 1913, as part of the Federal Reserve Act.

Question

Quizplus · Accepted Answer

Gresham's Law states that "bad money drives out good money," meaning that if two forms of commodity money are in circulation, the one with lower intrinsic value will circulate more widely than the one with higher intrinsic value.