Question from a newbie regarding face values

[Drake181]

Hi everybody!

In regards to the face value of australian precious metal coins; how is this decided? E.g a 1 oz silver coin has a demenomination of $1, why not $5 or $10?

 

[sammysilver]

It is a nominal amount and would never be considered a floor price. Occasionally the $200 gold coin and the State $10 coins were worth more as a coin than their metal value so governments look to a low value.

Also if legal tender is counterfeited, Interpol will chase you around the world, whereas copying a round is just a copyright issue.

 

[Cind3r]

how is this decided?

Sammysilvers response is "why" the coins have a value. Great response btw.

"How" it is decided is basically by the mood of the treasurer. What ever she/he deems worthy at the time. Obviously there is more to it like treasury guidelines but by law the treasurer could make a coin to any value...

Ref: https://www.legislation.gov.au/Details/C2016C01090

14A Issue price of coins of certain denominations
(1) Coins:
(a) of a denomination of $5 or more; or
(b) whose standard composition consists of, or includes, gold, silver or platinum; shall be issued at prices:
(c) determined, in writing, by the Treasurer; or
(d) calculated in accordance with a method determined, in writing, by the Treasurer.