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Consider the following statements
Legal Tender Money is anything recognised by law as a means to settle a public or private debt or meet a financial obligation.
Fiat money is a government-issued currency that is not backed by a commodity such as gold.
In India, coins are legal tender in limited quantities.
Select the correct statement.
1&2 only
2&3 only
1&3 only
All of the above
All statements are correct.
Legal Tender Money is anything recognised by law as a means to settle a public or private debt or meet a financial obligation, including tax payments, contracts, and legal fines or damages, is considered legal tender.
Fiat money is a government-issued currency that is not backed by a physical commodity, such as gold or silver, but rather by the government that issued it. The value of fiat money is derived from the relationship between supply and demand and the stability of the issuing government, rather than the worth of a commodity backing it. Most modern paper currencies are fiat currencies.
Limited Legal Tender Money is a type of money that can be used to pay off a debt up to a certain amount, after which a person can refuse to accept the payment and no legal action can be taken against them. In India, coins are legal tender in limited quantities.
Where as In Unlimited Legal Tender Money, it is possible to pay off any amount of debt. A person who refuses to accept this money may face legal action. In India, paper notes/currency are unlimited legal tender.
Hence option 4th is correct.
By: Shubham Tiwari ProfileResourcesReport error
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