What are the Advantages of money economy over barter trade?

Answer 1

Money solved all of the problems that the barter system created. This included a lack of common measure of value of commodities in barter. It also many other advantages which included portability and durability.

Answer 2

Bartering is difficult because, for each transaction, both parties must agree upon the accepted values for each item being traded. If one person wants a horse but has only wheat to trade, how much wheat would need to be provided for one horse? And how difficult would it be to exchange that much wheat?

Also, if the man with the horse does not want wheat, then a third person must be found, one with whiskey for instance, who will take part in a three-way swap.

Money makes it easier to establish value for items and is obviously more portable and simpler to exchange.

Answer 3

With money as medium of exchange is easier than barter system. There are many reasons like barter system does not give the true value of a product and sometimes one party needs the other product but the other party does not require the other product. It creates misunderstanding and also a problem that how to evaluate the true value of the commodity. And also, money can be broken down into smaller parts like we purchase candies for like cents or pennies etc. Moreover, how can we barter for big things like house. It would be almost impossible to barter for the house with pair of glasses or pair of shoes or for a mobile phone. Barter system does not give the original value of the product or a commodity.

Answer 4

Why is it important than money be divisible