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Countertrade is a method of barter that never includes cash payments.

a. true
b. false

User Heike
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1 Answer

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Final answer:

The statement that countertrade never includes cash payments is false. Countertrade refers to exchanging goods and services without currency but can include partial cash payments in a capitalist system. Traditional bartering is different in that it requires a direct exchange without any monetary component.

Step-by-step explanation:

Countertrade is an alternative to cash transactions wherein parties exchange goods and services for other goods and services. While countertrade signifies trade conducted without the exchange of currency, it does not necessarily imply that cash payments are completely absent. Various forms of countertrade can involve partial payments in cash. Thus, asserting that countertrade never includes cash payments is false.

In a capitalism economic system, where there's an impetus to produce profit, countertrade is often used as a strategy to facilitate trading when currency exchange is difficult, or to gain access to markets where the local currency may be unstable or hard to convert.

The traditional system of bartering, however, involves a direct exchange of goods and services without the use of money at all. This can be challenging in a modern economy due to the necessity for a double coincidence of wants, which can be an inefficient way to meet people's needs, especially when future contracts or perishable goods are involved.

User Tws
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