Question : When money value of money exceeds the commodity value of money, it is called:
Option 1: Full-bodied money
Option 2: Flat money
Option 3: Credit money
Option 4: Fiduciary money
Answer (1)
24th Jan, 2024
Correct Answer: Flat money
Solution : The correct answer is (b) Credit money
When the value of money exceeds the commodity value of money, it is called credit money. Credit money refers to a form of money that is not backed by a physical commodity but is based on the creditworthiness and trust of the issuer. The value of credit money is derived from the promise of the issuer to redeem it for goods, services, or legal tender. Therefore, the correct answer is Credit money.
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