Which type of money is MOST likely to see its value fluctuate in the foreign exchange market?

Question

Quizplus · Accepted Answer

Fiat money is not backed by a commodity such as gold, so its value is determined by supply and demand in the foreign exchange market. This makes it more susceptible to fluctuations in value compared to commodity money, which has intrinsic value based on the commodity it is made from. Price-indexed money and pegged exchange rates both have their value tied to a specific reference point, which can help stabilize their value in the foreign exchange market.

Which Type of Money Is MOST Likely to See Its