What Is the Main Reason That Fiat Money Has Value

question 16

Multiple Choice

What is the main reason that fiat money has value?

• A)Because it can be manufactured at will by the issuing government.
• B)Because it has intrinsic value equal to its face value.
• C)Because it is fully backed by gold at a fixed ratio.
• D)Because it is only fractionally backed by gold.
• E)Because it is generally accepted.

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Definitions:

Control

The power to influence or direct people's behavior or the course of events.

Stress

A physical, mental, or emotional factor that causes bodily or mental tension.

Approach-avoidance Conflict

A psychological struggle or dilemma when a goal has both attractive and unattractive aspects, leading to ambivalence.

Approach-approach Conflict

A situation in psychology where an individual must choose between two equally appealing options, causing conflict due to the difficulty in making a decision.