Writer a paragraph about bad effects of Barter system
Answers
Answer:
Double Coincidence of Wants: Owning to lack of generally acceptable medium of exchange, a difficult problem of double coincidence of wants was faced by the persons who wanted to sell and buy goods. ...
Impossibility of Subdivision of Goods: ...
Lack of Information: ...
Production of Large and Very Costly Goods not Feasible
Explanation:
Lack of a Common Measure of Value: Another difficulty under the barter system relates to the lack of a common unit in which the value of goods and services should be measured. ... Consequently, one party is at a disadvantage in the terms of trade between the two goods.
Explanation:
Difficulty in Storing Value: Under the barter system it is difficult to store value. Anyone wanting to save real capital over a long period would be faced with the difficulty that during the intervening period the stored commodity may become obsolete or deteriorate in value.