Describe what greshams law is Describe it in your own words

Describe what gresham\'s law is. Describe it in your own words without using sources. Then demonstrate an example of how greshams law is used in the retail industry. The demonstration must be from your own unique approach. Do not look on the internet or any sources. No plagiarism.

Solution

Gresham\'s law is an economic principle that states: \"When a government overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation

It is like dollar and yen Dollar was evenly valued to make imports attractive and yen was undervalued to make exports competetive out of japan.

Over years indian rupee has depreciated over the dollar making inports costlier to india and export competetive.Emerging economies the currency tends to depreciate with time as i have observed over years.

the tendency for money of lower intrinsic value to circulate more freely than money of higher intrinsic and equal nominal value (often expressed as ‘Bad money drives out good’