C. Bad money drives out good money when both are legal tender at fixed rates
D. Only metallic money circulates
Answer: Option C
Solution (By JKSSB Mock Tests)
Gresham’s Law observes that when two forms of money have the same face value but different intrinsic values, the money with lower intrinsic value (bad money) tends to remain in circulation while the higher-value money (good money) is hoarded or exported.
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