Fiat money
A)has value because people accept it
B)has intrinsic value
C)is backed by commodity reserves
D)is money because of its metallic content
E)is frequently "clipped"

Question

Quizplus · Accepted Answer

Fiat money has no intrinsic value and is not backed by commodity reserves or metallic content. Its value is derived from the faith and confidence people have in the government issuing it and its acceptance as a medium of exchange in the economy. "Clipping" refers to the practice of shaving off some of the metal from coins for the purpose of debasing the currency, which is not applicable to fiat money.

Fiat Money