Final answer:
True. Precious metals like gold and silver are valued above costs due to their immediate marketability and potential for capital gains. Prices for these metals are readily available in financial markets, and they have historically been used as a form of commodity money and for backing commodity-backed currencies.
Step-by-step explanation:
The question pertains to the valuation of precious metals because they can be quickly sold in the market at a known price. Precious metals such as gold and silver are highly marketable because they have an intrinsic value and are recognized globally. These commodities have prices that can be readily found on financial markets, and their value can rise above the cost due to market demand.
For instance, gold has been valued not just for its aesthetic use in jewelry but also as a form of commodity money and as a backing for commodity-backed currencies. The fluctuations in gold prices between 1981 and 2017 illustrate how precious metal investments can lead to capital gains—the core of the investor's hope of buying at a low price and selling at a higher one.
Investors rarely handle the physical goods themselves; typically, they trade contracts representing ownership of a certain amount of these commodities, which are then stored in a secured place like a warehouse. Therefore, precious metals can indeed be valued above their costs due to their immediate marketability and potential for capital gains.