Question

Lack of commonunit of measurement​

Answer 1

Answer:-

Lack of common unit of measurement under Barter System:

Problem of double wants - do I want the eggs in exchange for the shoes you are selling ? Maybe I'm a vegan, so your eggs are no good for a trade.

• Not all goods can be broken down into smaller parts - a horse cannot be cut in 3 pieces and sold to 3 people. It would lose most of its value and only be alone sold as meat if we cut it in 3. Unlike gold.
• The most complex is an exchange system has to set up for all goods. 10 kg rice can buy 20 kg wheat but only 3 kg almonds. In a colder country maybe just 2 kg almonds as its more in demand so exchange rate is more expensive.

--The point is that currently you exchange everything with respect to money . In barter you exchange everything with respect to every other thing. There are so many combinations of how much of this can that buy, it would give you a headache. Which is why money ‘the general medium of exchange’ was created. It solves all 3 problems above.

OR

Lack of common measure of value:

In barter, there is no common measure (unit) of value. Even if buyer and seller of each other commodity happen to meet, the problem arises in what proportion the two goods are to be exchanged. Money obviates these difficulties and acts as a convenient unit of value and account.