Chapter 3 · Question 1
How does money solve the problem of double coincidence of wants?
Q1
How does money solve the problem of double coincidence of wants?
Answer Revealed
Direct Answer:
Money acts as a common medium of exchange, so a person can sell goods or labour for money and use that money to buy something else. This removes the need for both parties to want exactly what the other offers at the same time.
Simple Explanation
Money acts as a common medium of exchange, so a person can sell goods or labour for money and use that money to buy something else. This removes the need for both parties to want exactly what the other offers at the same time.
Exam-Ready Structure
Money acts as a common medium of exchange, so a person can sell goods or labour for money and use that money to buy something else. This removes the need for both parties to want exactly what the other offers at the same time.
Key Points
- Money acts as a common medium of exchange, so a person can sell goods or labour for money and use that money to buy something else.
- This removes the need for both parties to want exactly what the other offers at the same time.