Why do governments make sure that the face values of currency exceed the intrinsic values of currency?

Question

Multiple choice question.

To discourage people from using other forms of currency.

To discourage people from destroying currency to resell the material it's made of

To encourage people to utilize other forms of currency

To save the government money by lowering the national debt

Answer 1

The correct answer is:

To discourage people from destroying currency to resell the material it's made of.

When the face value of currency exceeds its intrinsic value (the material it is made of), it helps prevent individuals from melting down coins or otherwise destroying currency for profit from the raw materials.