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Unformatted text preview: indirect exchange Searches by potential barterers for some double coincidence of wants will be extremely time consuming in a large, highly specialized economy with millions of products and people. Barter was abandoned and a system of indirect exchange was adopted instead. Indirect exchange significantly reduces the time spent on any one transaction. In spite of widely different tastes within a society, there will be a small number of commodities most everybody is will to accept for exchange purposes. Everyone will maintain an inventory of the generally accepted commodities and virtually all exchanges will be made with these commodities. We then have a medium of exchange. We call the medium of exchange money....
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This note was uploaded on 11/22/2011 for the course FIN FIN1100 taught by Professor Bradrifkin during the Fall '09 term at Broward College.
- Fall '09
- Personal Finance