why is money transaction system better than barter system ? explain with example
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Answered by
117
Money transaction system eliminates the problem of double coincidence of wants.
Faster mode of payment.
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38
The money transaction system is better due to easy service and speed.
- An individual holding cash can easily exchange it for any product or service that the person in question may need.
- Along these lines, everybody likes to receive part payments in cash and afterward trade the cash for things that they need.
- Whereas In barter, it is hard to track down the person willing to purchase what precisely the merchant needs to sell. The double coincidence of needs creates a problem.
- For example, a bottle producer is willing to sell bottles and wants to buy rice. For this, he will search for a farmer growing rice who will exchange his rice with bottles.
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