EBK MACROECONOMICS
5th Edition
ISBN: 8220106773925
Author: KRUGMAN
Publisher: MAC HIGHER
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Chapter 14, Problem 2P
To determine
Concept Introduction:
Commodity Money:
The value of that particular currency is related to the commodity of which that currency is made like gold coins, silver coins, or it can be said that the value of the currency is same as the value of the commodity of which the currency is made of.
Commodity-basket Money:
The value of that particular currency is measured in terms of one particular commodity like the value of paper currency is measured in terms of gold.
Fiat Money:
The value of that particular currency is related to the demand and supply of that currency and it is not related to the material of which the currency is made up of. This money is treated as legal tender by the government.
To identify: The type of money used in each situation.
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