Question
If dollar bills (Federal Reserve notes) are backed by nothing but promises and are in real terms worthless, why do people accept them? LO3
Step 1
Fiat money is a type of currency that is not backed by a physical commodity like gold or silver. Instead, its value comes from the trust and confidence that people have in the government that issues it. The U.S. dollar is an example of fiat money. Show more…
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