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| Q. |
Gresham's Law means - |
| A. | Good money replaces bad money in circulation |
| B. | Bad money replaces good money in circulation |
| C. | Good money promotes bad money in the system |
| D. | Bad money promotes good money in the system |
| Answer» B. Bad money replaces good money in circulation | |
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Explanation: Gresham's law is an economic principle that states: "When a government compulsorily overvalues one type of money and undervalues another, the under-valued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation." |
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