ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Barter is an act of trading goods or services between two or more parties without the use of money-or a monetary medium, such as a credit card. In essence, bartering involves the provision of one good or service by one party in return for another good or service from another party.

Detailed explanation-2: -The barter system often creates an unbalanced system of trade, where parties are unable to find others willing to trade. The barter system also lacks a common unit of measurement for goods and services. Since most goods depreciate with time, they become less attractive for trade and storing value.

Detailed explanation-3: -Money evaluates every commodity and service with a convincing value. A person who doesn’t want anything in exchange will also be ready to work for someone for money. Money is a durable thing and lasts many years, even if kept unused.

Detailed explanation-4: -In the barter system, people exchange goods directly without the use of money.

Detailed explanation-5: -Barter is an alternative method of trading where goods and services are exchanged directly for one another without using money as an intermediary. For instance, a farmer may exchange a bushel of wheat for a pair of shoes from a shoemaker.