What is a barter system? What are its drawbacks?

1.	What is a barter system? What are its drawbacks?
Answer» Barter System is a system of exchange in which one commodity is exchanged for another commodity. Drawbacks of Barter Systems: 1. Lack of double coincidence of wants. 2. Lack of a common measure of value. 3. Indivisibility of certain goods. 4. Difficulty in making deferred payments. 5. Difficulty in storing value.

Answer»

Barter System is a system of exchange in which one commodity is exchanged for another commodity.

Drawbacks of Barter Systems:

1. Lack of double coincidence of wants.

2. Lack of a common measure of value.

3. Indivisibility of certain goods.

4. Difficulty in making deferred payments.

5. Difficulty in storing value.

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What is a barter system? What are its drawbacks?

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