If the cost of producing coins is lower than the face value of the coins,then the government receives revenue called
A)token money,and produces token coins
B)seigniorage,and produces fiat money
C)token money,and produces fiat money
D)seigniorage,and produces token coins
E)token money,and produces seignior coins

Question

Quizplus · Accepted Answer

Seigniorage is the difference between the face value of a coin or a banknote and its production cost. So, if the cost of producing coins is lower than the face value of the coins, then the government receives revenue called seigniorage. Producing token coins does not relate to this situation, as token money is a type of currency whose face value exceeds its cost of production but only by a small amount, and it is not produced by the government. Fiat money is a currency that is not backed by any commodity or asset, and producing it is not related to the situation mentioned in the question. Seignior coins do not exist.

If the Cost of Producing Coins Is Lower Than the Face