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Discuss on Paper Money

Discuss on Paper Money

Answers

Wilfred
It implies currency notes as well as any other representative money that is in paper form.
Types of money:-
1. Convertible paper money- it is where paper money is convertible into gold on demand e.g. Special Drawing Rights (SDRs) are IMF documents that represents individual country?s paper currency that is backed by gold.

2. In-convertible paper money- Where paper money is not convertible into gold on demand then the paper money is referred to a in-convertible paper money. Nowadays all paper money are not convertible into gold hence we call it the fiduciary issue – accepted by citizens of a country out of its legal tender. Hence in-convertible paper money is referred as fiduciary issue implying money that is not backed by gold.

Wilfykil answered the question on March 8, 2019 at 10:17

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