Asked by
Cassie Garner
on Nov 11, 2024
Verified
Which of the following is not true of Federal Reserve notes?
A) They are fiat money.
B) They are a liability of the Fed.
C) They are redeemable for other Federal Reserve notes.
D) They are redeemable for gold.
E) They are counted as currency in the money supply
Fiat Money
Currency that a government has declared to be legal tender, despite it having no intrinsic value or being backed by a physical commodity.
Liability
A legal financial obligation or debt that an entity owes to another entity, required to be settled through the transfer of assets, provision of services, or other financial settlement.
- Understand the nature and function of fiat money, including Federal Reserve notes.
- Understand the role of the Federal Reserve in managing money supply and regulating banks.
Verified Answer
CB
Learning Objectives
- Understand the nature and function of fiat money, including Federal Reserve notes.
- Understand the role of the Federal Reserve in managing money supply and regulating banks.