Seigniorage

Seigniorage is a type of money made by governments when they make coins or print paper money. When the government makes coins or prints paper money, it costs them less money than the face value of what they are creating. For example, it might cost the government one penny to make a coin that it marks as being worth one dollar. The government then keeps the difference, which is ninety-nine cents. This money made by the government is called seigniorage.