eli5 what determines the cost of making money

Question

Why does it cost more to make a 20 dollar bill than a 1 dollar bill but it costs around the same to make a 20 and a 100 dollar bill?

In: Economics

Answer 1

The cost of making money is just like the cost of making any product: you have research and development of the product, you have to figure out the process of making it which includes buying a lot of tooling and equipment, and then you have to purchase all the raw materials to actually produce the product. More complex products, like the $100 bill, will have a more complex manufacturing process which drives up the cost due to having to buy special equipment. They will also have more raw material inputs than a $1 bill, so that also adds to the cost.