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When both parties agree to sell and buyeach others commodities it is knownas :
[2011 (T-2)]
  • a)
    measure of value
  • b)
    double coincidence of wants
  • c)
    store of value
  • d)
    credit
Correct answer is option 'B'. Can you explain this answer?
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When both parties agree to sell and buyeach others commodities it is k...
Double Coincidence of Wants

The term "double coincidence of wants" refers to a situation in which both parties involved in a transaction have a mutual desire to sell and buy each other's commodities. It is a necessary condition for barter trade to occur smoothly, as it ensures that both parties are willing to exchange goods or services without the need for a medium of exchange such as money.

When both parties agree to sell and buy each other's commodities:


  • It is known as double coincidence of wants. This means that both parties have a mutual desire to trade their goods or services with each other.

  • This condition is essential for a barter trade to take place. In a barter system, goods or services are exchanged directly without the use of money as a medium of exchange.

  • Double coincidence of wants eliminates the need for a medium of exchange and allows for a direct exchange between parties.

  • It requires both parties to have a complementary demand and supply, where one party wants what the other party has to offer.

  • Without double coincidence of wants, it would be difficult to facilitate a smooth exchange of goods or services, as one party may not have a desire for the goods or services offered by the other party.


Therefore, when both parties agree to sell and buy each other's commodities, it is known as the double coincidence of wants, which is a necessary condition for barter trade.
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Read the extract given below and answer the questions that follows:Bartering is the act of trading one good or service for another without using a medium of exchange such as money. A bartering economy differs from a monetary economy in a variety of ways. When barter was used as an exchange medium, the needs of people were very limited. This trading method doesn’t involve money and it relies solely on exchanging goods and services for other services and goods in return. The use of money spans a very large part of our everyday life. To understand the usefulness of money, we must consider what the world would be like without money. How would people exchange goods and services? Economies without money typically engage in the barter system. Barter is highly inefficient for trying to coordinate the trades in a modern advanced economy. In an economy without money, an exchange between two people would involve a double coincidence of wants, a situation in which both the parties have to agree to sell and buy each other’s commodities. This is known as double coincidence of wants. What a person desires to sell is exactly what the other wishes to buy. In a barter system where goods are directly exchanged without the use of money, double coincidence of wants is an essential feature. Another problem with the barter system is that it does not allow us to easily enter into future contracts for purchasing many goods and services. Money solves the problems that the barter system creates. Money serves as a medium of exchange, which means that money acts as an intermediary between the buyer and the seller. Modern forms of money include currency — paper notes and coins. The other form in which people hold money is as deposits with banks.Answer the following MCQs by choosing the most appropriate optionQ. In a barter system

Read the extract given below and answer the questions that follows:Bartering is the act of trading one good or service for another without using a medium of exchange such as money. A bartering economy differs from a monetary economy in a variety of ways. When barter was used as an exchange medium, the needs of people were very limited. This trading method doesn’t involve money and it relies solely on exchanging goods and services for other services and goods in return. The use of money spans a very large part of our everyday life. To understand the usefulness of money, we must consider what the world would be like without money. How would people exchange goods and services? Economies without money typically engage in the barter system. Barter is highly inefficient for trying to coordinate the trades in a modern advanced economy. In an economy without money, an exchange between two people would involve a double coincidence of wants, a situation in which both the parties have to agree to sell and buy each other’s commodities. This is known as double coincidence of wants. What a person desires to sell is exactly what the other wishes to buy. In a barter system where goods are directly exchanged without the use of money, double coincidence of wants is an essential feature. Another problem with the barter system is that it does not allow us to easily enter into future contracts for purchasing many goods and services. Money solves the problems that the barter system creates. Money serves as a medium of exchange, which means that money acts as an intermediary between the buyer and the seller. Modern forms of money include currency — paper notes and coins. The other form in which people hold money is as deposits with banks.Answer the following MCQs by choosing the most appropriate optionQ. Which of the following features of money acts as an intermediate in the exchange process?

Read the extract given below and answer the questions that follows:Bartering is the act of trading one good or service for another without using a medium of exchange such as money. A bartering economy differs from a monetary economy in a variety of ways. When barter was used as an exchange medium, the needs of people were very limited. This trading method doesn’t involve money and it relies solely on exchanging goods and services for other services and goods in return. The use of money spans a very large part of our everyday life. To understand the usefulness of money, we must consider what the world would be like without money. How would people exchange goods and services? Economies without money typically engage in the barter system. Barter is highly inefficient for trying to coordinate the trades in a modern advanced economy. In an economy without money, an exchange between two people would involve a double coincidence of wants, a situation in which both the parties have to agree to sell and buy each other’s commodities. This is known as double coincidence of wants. What a person desires to sell is exactly what the other wishes to buy. In a barter system where goods are directly exchanged without the use of money, double coincidence of wants is an essential feature. Another problem with the barter system is that it does not allow us to easily enter into future contracts for purchasing many goods and services. Money solves the problems that the barter system creates. Money serves as a medium of exchange, which means that money acts as an intermediary between the buyer and the seller. Modern forms of money include currency — paper notes and coins. The other form in which people hold money is as deposits with banks.Answer the following MCQs by choosing the most appropriate optionQ. Which of the following has an essential feature of double coincidence?

Read the extract given below and answer the questions that follows:Bartering is the act of trading one good or service for another without using a medium of exchange such as money. A bartering economy differs from a monetary economy in a variety of ways. When barter was used as an exchange medium, the needs of people were very limited. This trading method doesn’t involve money and it relies solely on exchanging goods and services for other services and goods in return. The use of money spans a very large part of our everyday life. To understand the usefulness of money, we must consider what the world would be like without money. How would people exchange goods and services? Economies without money typically engage in the barter system. Barter is highly inefficient for trying to coordinate the trades in a modern advanced economy. In an economy without money, an exchange between two people would involve a double coincidence of wants, a situation in which both the parties have to agree to sell and buy each other’s commodities. This is known as double coincidence of wants. What a person desires to sell is exactly what the other wishes to buy. In a barter system where goods are directly exchanged without the use of money, double coincidence of wants is an essential feature. Another problem with the barter system is that it does not allow us to easily enter into future contracts for purchasing many goods and services. Money solves the problems that the barter system creates. Money serves as a medium of exchange, which means that money acts as an intermediary between the buyer and the seller. Modern forms of money include currency — paper notes and coins. The other form in which people hold money is as deposits with banks.Answer the following MCQs by choosing the most appropriate optionQ. Which of the following can be considered a modern form of Money?

Sri Lanka emerged as an independent country in 1948. The leaders of the Sinhala community sought to secure dominance over government by virtue of their majority. As a result, the democratically elected government adopted a series of MAJORITARIAN measures to establish Sinhala supremacy. In 1956, an Act was passed to recognise Sinhala as the only official language, thus disregarding Tamil. The governments followed preferential policies that favoured Sinhala applicants for university positions and government jobs. A new constitution stipulated that the state shall protect and foster Buddhism. All these government measures coming one after the other, gradually increased the feeling of alienation among the Sri Lankan Tamils. They felt that none of the major political parties led by the Buddhist Sinhala leaders was sensitive to their language and culture. They felt that the constitution and government policies denied them equal political rights, discriminated against them in getting jobs and other opportunities and ignored their interests. As a result, the relations between the Sinhala and Tamil communities strained over time. The Sri Lankan Tamils launched parties and struggles for the recognition of Tamil as an official language, for regional autonomy and equality of opportunity in securing education and jobs. But their demand for more autonomy to provinces populated by the Tamils was repeatedly denied. By 1980s several political organisations were formed demanding an independent Tamil Eelam (stat e) in northern and eastern parts of Sri Lanka. . As a result, thousands of people of both the communities were killed. Many families were forced to leave the country as refugees and many more lost their livelihoods. The distrust between the two communities turned into widespread conflict. It soon turned into a CIVIL WAR. Sri Lanka’s population is comprised of 75 percent Sinhalese and 24 percent Tamil speakers (11% Sri Lankan Tamils, 9% Moors, and 4% Indian Tamils), with smaller communities of Malays, Burghers, and others. The Sri Lankan civil war, which ended in 2009, was triggered in part by the introduction of language policies that created divisions along ethnic and linguistic lines.What were the majoritarian measures adopted by the democratically elected government in Sri Lanka in the 1950s and how did they contribute to the strained relations between the Sinhala and Tamil communities?

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When both parties agree to sell and buyeach others commodities it is knownas :[2011 (T-2)]a)measure of valueb)double coincidence of wantsc)store of valued)creditCorrect answer is option 'B'. Can you explain this answer?
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