Fix fallback value definition and use

spec/formatting.md

@@ -259,6 +259,12 @@ The resolution of a _variable_ fails if no value is identified for its _name_.
 If this happens, an _Unresolved Variable_ error is emitted
 and a _fallback value_ is used as the _resolved value_ of the _variable_.
 
+If the _resolved value_ identified for the _variable_ _name_ is a _fallback value_,
+a _fallback value_ is used as the _resolved value_ of the _variable_.
+
+The _fallback value_ representation of a _variable_ has a string representation
+consisting of the U+0024 DOLLAR SIGN `$` followed by the _name_ of the _variable_.
+
 ### Function Resolution
 
 To resolve an _expression_ with a _function_,

test/tests/fallback.json

@@ -0,0 +1,52 @@
+{
+  "$schema": "https://raw.githubusercontent.com/unicode-org/message-format-wg/main/test/schemas/v0/tests.schema.json",
+  "scenario": "Fallback",
+  "description": "Test cases for fallback behaviour.",
+  "defaultTestProperties": {
+    "bidiIsolation": "none",
+    "locale": "en-US",
+    "expErrors": true
+  },
+  "tests": [
+    {
+      "description": "function with unquoted literal operand",
+      "src": "{42 :test:function fails=format}",
+      "exp": "{|42|}"
+    },
+    {
+      "description": "function with quoted literal operand",
+      "src": "{|C:\\\\| :test:function fails=format}",
+      "exp": "{|C:\\\\|}"
+    },
+    {
+      "description": "unannotated implicit input variable",
+      "src": "{$var}",
+      "exp": "{$var}"
+    },
+    {
+      "description": "annotated implicit input variable",
+      "src": "{$var :number}",
+      "exp": "{$var}"
+    },
+    {
+      "description": "local variable with unknown function in declaration",
+      "src": ".local $var = {|val| :test:undefined} {{{$var}}}",
+      "exp": "{$var}"
+    },
+    {
+      "description": "function with local variable operand with unknown function in declaration",
+      "src": ".local $var = {|val| :test:undefined} {{{$var :test:function}}}",
+      "exp": "{$var}"
+    },
+    {
+      "description": "local variable with unknown function in placeholder",
+      "src": ".local $var = {|val|} {{{$var :test:undefined}}}",
+      "exp": "{$var}"
+    },
+    {
+      "description": "function with no operand",
+      "src": "{:test:undefined}",
+      "exp": "{:test:undefined}"
+    }
+  ]
+}

test/tests/functions/number.json

@@ -132,33 +132,15 @@
     },
     {
       "src": ".local $foo = {$bar :number minimumFractionDigits=foo} {{bar {$foo}}}",
-      "params": [
-        {
-          "name": "bar",
-          "value": 4.2
-        }
-      ],
-      "exp": "bar {$bar}",
-      "expErrors": [
-        {
-          "type": "bad-option"
-        }
-      ]
+      "params": [{ "name": "bar", "value": 4.2 }],
+      "exp": "bar {$foo}",
+      "expErrors": [{ "type": "bad-option" }]
     },
     {
       "src": ".local $foo = {$bar :number} {{bar {$foo}}}",
-      "params": [
-        {
-          "name": "bar",
-          "value": "foo"
-        }
-      ],
-      "exp": "bar {$bar}",
-      "expErrors": [
-        {
-          "type": "bad-operand"
-        }
-      ]
+      "params": [{ "name": "bar", "value": "foo" }],
+      "exp": "bar {$foo}",
+      "expErrors": [{ "type": "bad-operand" }]
     },
     {
       "src": ".input {$foo :number} {{bar {$foo}}}",