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28 January, 05:25

Suppose that in a barter economy Kyle bakes bread and Alicia produces chocolates. Kyle wants chocolates but Alicia doesn't like bread, so Alicia is unwilling to trade with Kyle. Kyle's problem is an example of which problem associated with a barter system?

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  1. 28 January, 05:29
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    Answer:The double coincidence of wants problem

    Explanation:

    The double coincidence of wants occurs when both people want to exchange their goods or services at the same time, for example one person wants a stove but the other one doesn't want a stove and want to exchange it for a cow and this one who want a stove has a cow that he wants to exchange to get a stove then the double coincidence of wants occurs

    However now let us say a person with a stove wants to exchange it but the person who has a cow doesn't want a stove for an exchange then a problem begins.

    Like the case above Alicia have chocolate he can exchange with Kylie but since she doesn't like bread which Kylie has to exchange for chocolate now they can't have an exchange.

    A barter system is an ancient method box exchange that was used before people could use money to buy what they need. In these days people don't on the internet where they exchange things one gives away the item that another person needs to receive the other item that they also need.

    For example one has a plasma TV but wants an exercising machine, whilst the one with exercising machine wants a plasma TV then they can make an exchange.

    A problem begins when the person on the other side doesn't want the good or item that is being offered for an exchange.
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