The figure given below represents the PPC in two nations

Question

The figure given below represents the PPC in two nations - Germany and Korea, producing only two goods, cars and food.Figure 2.4
 
-Money exchanges are more efficient than barter because:
A)money exchanges do not require a double coincidence of wants. 
B)the government guarantees the value of money. 
C)money usually has an intrinsic value. 
D)money is backed by a physical commodity. 
E)opportunity costs are higher with barter trades.

Quizplus · Accepted Answer

Money exchanges do not require a double coincidence of wants, which means that parties do not need to have exactly what the other party wants in order to trade. In a barter system, both parties would need to have something the other wants in order to trade, making it less efficient. The other options are not related to the efficiency of money exchanges.