In what sense can it be said that money is a social invention? How does a barter system of trade compare to the invention of money?
Money is a social invention in the sense that all members of a society must agree to accept a particular item in exchange for all other goods and services. Money permits a much greater degree of specialization in the economy and, therefore, a much higher standard of living. Without money, trade and exchange would have to take place in a barter system. This system requires the trading of goods or services for other goods or services. And furthermore, there must be a double coincidence of wants. This means that persons desiring a particular good or service must find someone with an opposite desire. This would require a great amount of search time that would reduce time available for production and, thus, reduce the amount of goods and services produced.
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Goods and services provided by state and local governments are:
A. included in GDP at cost. B. excluded from GDP because they are not sold in markets. C. excluded from GDP because they are publicly provided. D. included in GDP at market prices.
How will the price and output of a monopolist compare with perfect competition?
a. The output of the monopolist will be too large and the price too high. b. The output of the monopolist will be too large and the price too low. c. The output of the monopolist will be too small and the price too high. d. The output of the monopolist will be too small and the price too low.
The value of GDP calculated by the expenditure method: a. includes inflation, while the value of GDP calculated by the income method excludes inflation. b. excludes inflation, while the value of GDP calculated by the income method includes inflation. c. is always equal to the value of GDP calculated by the income method
d. is always greater than the value of GDP calculated by the income method.
Refer to Table 3.1 to answer the following questionTable 3.1 Individual Demand and Supply SchedulesQuantity Demanded byPriceAlejandroBenCarlMarket$8.00842________6.001244________4.002046________2.002246________Quantity Supplied byPriceAveryBrandonCassandra $8.006046________$6.004244________$4.002442________$2.00640________In Table 3.1, if the price is $8, the market will
A. Experience a surplus of 56 units. B. Experience a surplus of 30 units. C. Experience a shortage of 22 units. D. Be in equilibrium.