Fiat money has value because:
A) it is backed by gold.
B) people believe it has value.
C) it has intrinsic value.
D) it is backed by silver.
E) None of these answers is correct.

Question

Quizplus · Accepted Answer

Fiat money has value because people believe that it has value. Unlike commodity money, it is not backed by a physical commodity such as gold or silver, but by the faith and credit of the government.

Fiat Money Has Value Because