Which of the following factors make a barter system inefficient relative to a money system?
a. Unanticipated inflation in the money system
b. Gains from trade for buyers in barter transactions come at the expense of an equivalent loss from trade for sellers.
c. Complete dependence on double coincidence of wants in a barter system.
d. People in close-knit communities cannot trust the quality of the barter goods being exchanged.
c
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Which one of the following would shift the aggregate demand curve to the left?
A) an increase in the money supply B) an increase in exports C) an increase in taxes D) an increase in government spending
The production of an industrial good in a plant emits harmful gases that cause breathing difficulty. Which of the following will happen if the government imposes a Pigouvian tax on the plant?
A) Marginal external cost will increase. B) Marginal private cost will fall. C) The quantity supplied of the good will decrease. D) The demand for the good will increase.