Which of the Following Is a Disadvantage of Barter as a Countertrade

question 104

Multiple Choice

Which of the following is a disadvantage of barter as a countertrade arrangement?

• A)It is a very complex arrangement.
• B)In a barter system,if goods are exchanged simultaneously,one party ends up financing the other.
• C)Firms engaged in barter run the risk of having to accept goods they do not want or cannot use.
• D)It involves huge cash transactions.
• E)It cannot be used in transactions with trading partners who are not creditworthy.

---

Definitions:

Self-Sufficient

The quality or condition of being able to fulfill all one's needs without reliance on external assistance.

Specialize

To focus on a specific area of production or study to gain efficiency or expertise.

Gains from Trade

The increase in welfare or economic benefit that countries or individuals obtain by engaging in voluntary exchanges where they specialize according to their comparative advantages.

Equilibrium

A state in a market where supply equals demand, leading to a stable situation where there is no tendency for prices to change, assuming other factors remain constant.