There are advantages and disadvantages to using fiat money. Which of the following benefits of fiat money comes with a potential risk to the economy as a whole?(1 point)

Question

Responses

Governments have greater control of the money supply.
Governments have greater control of the money supply.

Valuable resources are not wasted backing fiat money.
Valuable resources are not wasted backing fiat money.

Fiat money can withstand repeated use.
Fiat money can withstand repeated use.

Fiat money can be easily transported.

Answer 1

The benefit of fiat money that comes with a potential risk to the economy as a whole is:

Governments have greater control of the money supply.

This can lead to risks such as inflation or hyperinflation if a government issues too much currency without backing it with adequate economic value.