WAEC SSCE - Commerce - 2014 (Objective)

Question 1 Report

The term "fiduciary issue" means

money issued without gold backing

money issued with gold backing

money issued as currency note

gold reserve

Answer Details

The term "fiduciary issue" means money issued without gold backing. In other words, fiduciary issue refers to the paper money that a government issues without having an equivalent amount of gold or other precious metals to back it up. The value of this money is based on the trust (or fiduciary relationship) that people have in the government that issued it. This type of money is also known as fiat money, which derives its value from the government's decree or fiat.






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