ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A barter economy is a cashless economic system in which services and goods are traded at negotiated rates. Barter-based economies are one of the earliest, predating monetary systems and even recorded history.

Detailed explanation-2: -A traditional economy is a system that relies on customs, history, and time-honored believes. Tradition guides economic decisions such as production and distribution. Societies with traditional economies depend on agriculture, fishing, hunting, gathering, or some combination of them.

Detailed explanation-3: -Also known as a subsistence economy, a traditional economy is defined by bartering and trading.

Detailed explanation-4: -The community is self-sustained through fishing, hunting and farming. The traditional economic system does not trade. The market participants consume the products that are produced/collected, and they rely on bartering to get the products that they want.

Detailed explanation-5: -Examples of traditional economies include the central African Mbuti, the Australian Aborigines, and the Inuit of Northern Canada. The main advantage of a traditional economy is that the answers to WHAT, HOW, and FOR WHOM to produce are determined by customs and tradition.