Friday, March 25, 2011

The 4 cent penny?

Did you know Canada.. it actually costs the Royal Canadian Mint up to four cents to produce and distribute a one-cent coin!

There have been repeated talks about removing the penny from circulation as the Canadian penny costs at least $130 million annually to keep in circulation. Check out this article from CTV Calgary a few months ago discussing the Canadian government getting closer to getting rid of the penny.

A 2007 survey shows that only 37% of Canadians use pennies but the government continues to produce about 816 million pennies per year, equal to 25 pennies per Canadian.

Other countries including Australia and New Zealand have already gotten rid of their penny.  New Zealand no longer even has a nickel!

The current composition of a penny is 94% steel, 1.5% nickel, 4.5% copper plated zinc. An interesting fact is that from May 2006 to October 2008, all circulation Canadian pennies from 1942 to 1996 had an intrinsic value of over $0.02 CAD based on the increasing spot price of copper in the commodity markets.

Source: economics.ca, Yahoo! xtra, Wikipedia

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