What is Active Money?
” While many people may think that all forms of currency are active, that is not the case. Active money refers to currency, both paper bills and coins, that is actively in circulation among the general public. This is in contrast to money that is currently held in the national treasury or Federal Reserve, which is considered to be non-active money. Here is some information about the circulation of active money, and why it is important to differentiate between inactive and active money. .
While many people may think that all forms of currency are active, that is not the case. Active money refers to currency, both paper bills and coins, that is actively in circulation among the general public. This is in contrast to money that is currently held in the national treasury or Federal Reserve, which is considered to be non-active money. Here is some information about the circulation of active money, and why it is important to differentiate between inactive and active money. The amount of money in circulation within a given country is determined by the basic guidelines in place to ensure that the face value of the currency remains equal in all parts of the country. That is, a five-dollar bill in the United States will still be valued at five dollars no matter where the bill is circulated in the country. In order to maintain the status quo, it is necessary to keep tight control on the amount of currency that is made available to the general public. When the need arises, the Fed
