Solved UPSC CDS/OTA Question
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Q · Money and Types of MoneyMedium · 45s
Q₄. Consider the following statements about fiat money: Its value is backed by precious metals like gold. Its acceptability is enforced by government law. Which of these statements is/are correct?
TopicMoney and Types of Money
Question Typemultiple choice
DifficultyMedium
Marking+1 / −0.33
Test Duration30 min
Step-by-Step Solution
The complete worked solution.
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Fiat money has no intrinsic value or backing by gold. Its legal tender status is by government order.
Final Answer: Option B — 2 only