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Question
______ are termed as Legal Tender Money.
Options
Demand deposits
Time Deposits
Inter-bank deposits
Currency Notes
Solution
Currency Notes are termed as Legal Tender Money.
Explanation:
Currency notes are referred to as Legal Tender Money. This means they are legally recognized as a honest payment method for debt settlement and must be accepted in transactions. Paper currency and coins are both considered legal tender.
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Match the following:
| Column I | Column II | ||
| A. | Currency | (i) | Something which is commonly used as medium of exchange |
| B. | Bank money | (ii) | Currency and demand deposits |
| C. | Money | (iii) | Bank demand deposits |
| D. | Modern form of money | (iv) | Paper notes + coins |
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What is fiat money?
