A bank note is said to be a legal tender because it is
Answer Details
A banknote is said to be a legal tender because it is backed by law. This means that it is accepted by law as a means of payment for goods and services. Legal tender is a form of payment that must be accepted by law for the settlement of debts, taxes, and other financial obligations. Therefore, a banknote can be used as a means of exchange in the economy because it is backed by the law, and it carries the full faith and credit of the government. The legal tender status of a banknote also ensures its acceptability and its value as a medium of exchange in the economy.