The currency of Camelot is the noble.King Arthur orders the minting of a five-noble gold coin,but it costs only four nobles to mine and process the amount of gold in the coin.Which of the following statements is true?
A)Five-noble coins will not be accepted in exchange.
B)Five-noble coins will be accepted only by the government.
C)When King Arthur spends these coins,he profits.
D)When King Arthur takes these coins in again in the form of taxes,he profits.
E)When these coins circulate through spending or taxation,King Arthur receives a profit of one noble,less seigniorage.

Question

Quizplus · Accepted Answer

King Arthur profits when he spends these coins because it costs him only four nobles to produce a coin that is worth five nobles, resulting in a profit of one noble per coin.

The Currency of Camelot Is the Noble