Which one of the following statements correctly describes the meaning of legal tender money ?
(a) The money which is tende ed in courts of law to defray the fee of legal cases
(b) The money which a creditor is under compulsion to accept in settlement of his claims
(c) The bank money in the form of cheques drafts, bills of exchange, etc.
(d) The metallic money in circulation in a country
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Thank you for this question. Please find the answer below:
Out of the given statements, the following is the statement that correctly describes Legal Tender Money;
(d) The metallic money in circulation in a country.
Legal tender money is the money that is issued by the state bank of a country and is accepted by the people of a country as official currency. It is the legal money, any other forms of money other than this is not accepted by the government or the people.
Out of the given statements, the following is the statement that correctly describes Legal Tender Money;
(d) The metallic money in circulation in a country.
Legal tender money is the money that is issued by the state bank of a country and is accepted by the people of a country as official currency. It is the legal money, any other forms of money other than this is not accepted by the government or the people.
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This question is in relation to the question asked in UPSC preliminary examination 2018,The correct answer is:-
(b) The money which a creditor is under compulsion to accept in settlement of his claim.
Reason--- because of RBI claims in currency notes that it will promise to pay the bearer its sums and hence creditor is under compulsion to accept. however each of these options are correct but we have to choose the most appropriate one which is option -(b)
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