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Questions
Explain the meaning of barter exchange by giving an example.
What is barter exchange?
Solution
- The direct exchange of a commodity for another commodity without the use of money is called barter exchange.
- For example, a piece of cloth was exchanged for a given quantity of wheat. A teacher was paid wheat or rice as a payment for his/her services.
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RELATED QUESTIONS
What is meant by the double coincidence of wants? How does money overcome this problem?
How does money solve the problem of lack a common measure of value that existed under the barter system?
Briefly explain the following with reference to the barter system of exchange.
(i) Lack of common measure of value.
(ii) Lack of standard of deferred payments.
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The system of exchanging things is known as _______.
Explanation of Keyword: Barter System
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The system of exchanging services and goods is known as the ________ system.
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Name the system in which the double coincidence of wants is an essential feature.
