Answer
Commodity money is money in the form of a commodity with intrinsic value. This means that the money would have value even if it were not used as money, a common example being gold.
Fiat money is money without intrinsic value, which only possesses value due to government decree. An example of this is bank notes and coins. In everyday life, most people use fiat money to participate in day-to-day transactions.
Work Step by Step
Students can refer to the definitions and discussions of the types of money..
