The Development of Barter and the History of Money

Flashcards covering the key concepts from the lecture on barter and the history of money.

Direct Production

Activities aimed at satisfying basic human needs such as food, clothing, and shelter without the aid of money.

Barter System

An economic system where goods and services are exchanged directly for other goods and services without using money.

Subsistence Economy

An economic system in which needs and wants are satisfied directly from nature.

Double Coincidence of Wants

A situation in the barter system where two parties want what the other has to offer, making an exchange possible.

Token Money

Items used in early trade as a medium of exchange before the introduction of coins and notes, such as shells or beads.

Commodity Money

Coins that have intrinsic value and were used in trade, usually made from precious metals.

Characteristics of Money

The essential traits money must possess, including durability, acceptability, exchangeability, divisibility, scarcity, and portability.

Functions of Money

Roles that money plays in an economy, including serving as a medium of exchange, measure of value, store of value, and standard for postponed payment.