UNIT 2: BARTER TRADE

In the context of barter trade, what is the condition called when an amount or quantity of goods exceeds that of what is used or needed?

• Deficit

• Equilibrium

• Surplus

• Shortage

Why did early humans engage in barter trade?

• Because money was readily available

• To exchange goods for services

• To satisfy their needs and wants

• Due to the lack of surplus goods

What is the term used to describe the system of trade where individuals exchange the surplus of one type of goods for another without involving money?

• Monetary exchange

• Barter trade

• Mercantilism

• Capitalistic trade

If a farmer wants clothes for his family and is willing to trade an extra chicken for them, what does this represent in the barter trade system?

• Demand

• Deficit

• Surplus

• Supply

What challenge might individuals face when attempting to find a suitable trading partner in barter trade?

• Lack of available goods

• Difficulty in determining exchange rates.

• Difficulty in finding coincidence of wants.

• Overabundance of surplus goods

In barter trade, what could contribute to disagreements on the exchange value of goods?

• Lack of communication between traders

• Inconsistency in the quality of goods

• High demand for certain goods

• Standardized valuation of all items

Before something can be considered as good money material, it should have the following qualities:

• Easily forged

• Rarely accepted.

• Readily accepted.

• Seasonally trade

Which characteristic is essential for the durability of good money material?

• It should be easily divisible into smaller units without losing value.

• It should have a long lifespan without deteriorating easily.

• It should be resistant to physical damage.

• It should be easily renewable.

What is a crucial aspect of good money related to durability?

• Easily decay

• Lasting for a short time

• Able to withstand wear and tear.

• Prone to rust and rot

What characteristic is desirable for the stability of good money?

• Frequently changing value

• Unpredictable value fluctuations

• Value that changes often

• Value that does not change often