Question

How does the use of money make it easier to exchange things? Give an example.(All India-2017)

Answer 1

Explanation:

Money as in notes and currency are what we call as legal tender that is it is legally accepted medium for carrying out market transactions. Money is used to buy and sell items. It can be used and widely accepted as the medium of exchange that is if you are trying to buy or sale an item using Indian rupee in India which is the legal tender in India then you are good to go, it is legal and socially acceptable..

I hope this is help you

Answer 2

Explanation:

Money overcomes the inefficiencies of the Barter system. Suppose a farmer who grows wheat wanted potatoes from another farmer who grows potatoes. There won't be any issue as long as the wheat growing farmer wants potatoes and the potato growing farmer wants wheat. Both items can be exchanged by the barter system. The problem would arise if the wheat growing farmer needs potatoes but the potato growing farmer needs tomatoes from a different farmer. The Barter system would not be useful in this case. To overcome this difficulty, money is used where money can be paid directly to buy what is needed without waiting for 'double coincidence of wants' to arise.