Apply concepts if you write your friend an IOU for a loan of twenty dollars, what type of money have you given her?

1 answer:

5 0

Answer: If you write out your friend an IOU for a loan of twenty dollars, you have given her the type of money called Representative Money.

Explanation:

This type of representative money has no intrinsic value at all. This is an exchange that is usually printed on paper, and represents a value of money, but has no value of its own. In this case, a friend gave someone 20.00$ and in return got a piece of paper stating they owe them the money back. The paper may state they will give them interest or no interest and may have a date for the return. The person who received the IOU can not use that paper in a store in exchange for goods and services.

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