103.1 Lesson - WhatIsFiat

Screen: WhatIsFiat

Headline: Fiat Currency: What is that?

Reward: 2

Text: All national currencies in circulation today are called “fiat” money. This includes US Dollars, Japanese Yen, Swiss Francs, and so forth.

The word “fiat” is latin for “by decree” -- which means “by official order”.

This means that all fiat money -- including the US Dollar -- is simply created by the order of the national government.

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QUIZ

Question: Who creates fiat currencies, such as US Dollars or Swiss Francs?

Answer: They are created by order of the National government in a given country.

Feedback: Correct. The central bank of a government creates fiat currencies.

Correct: true

Answer: By the manager of the local branch bank.

Feedback: Not quite. While local banks can give out loans based on credit and create money by doing so, they cannot create fiat currencies. Try again.

Correct: false

Answer: The Monopoly Money Man.

Feedback: Nope. Try again!

Correct: false