An item designated as money that is intrinsically worthless is ?
Correct answer: C. fiat money
- A. precious metals
- B. commodity money
- C. fiat money
- D. barter items
Explanation
Fiat money has little or no intrinsic value as a commodity, but it is accepted because the government declares it legal tender and users trust it as a medium of exchange. Precious metals and commodity money have value independent of their monetary use.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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