Think About It (Page 232) What are the different types of difficulties you encountered in the situation above? Class 7
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Think About It (Page 232) What are the different types of difficulties you encountered in the situation above? Class 7
What are the different types of difficulties you encountered in the situation above? Class 7
Answer:
In the barter system, as a farmer with only an ox to trade, I would face several difficulties.
- I need to find someone who wants an ox, which is challenging because everyone not needs ox. This is called the "double coincidence of wants."
- An ox is high valuable to exchange smaller things like shoes, sweater and medicine.
- If I manage to trade my ox for bags of wheat, I would have to find different people to exchange that wheat for shoes, a sweater, and medicines. This means I would have to carry the wheat around, which is not easy (the problem of portability).
- I would need to discuss and agree on how much wheat is fair for each item, which can be complicated without a common standard measure of value.
- I would have leftover wheat that I need to store safely, and it could spoil or get damaged. All these issues make trading in a barter system quite difficult!