Rahul has a sack of cotton but he is in need of wheat and Anush has a sack of wheat and is in need of cotton, under this situation both will be able to exchange their goods. In case of absence of such coincidence of wants, they may not exchange their goods. Which one of the following would be the best option that describes the mutual exchange of goods and eliminate the exchange of goods?
Options:
a. Double coincidence of want, Exchanging commodity for commodity. b. Double Coincidence of want, Credit on Commodity
c. Double coincidence of want, Loan on commodity.
d. Double coincidence of want, Money
Options:
a. Double coincidence of want, Exchanging commodity for commodity. b. Double Coincidence of want, Credit on Commodity
c. Double coincidence of want, Loan on commodity.
d. Double coincidence of want, Money
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a. Double coincidence of want, Exchanging commodity for commodity.
The term "double coincidence of wants" refers to a situation where two individuals have goods that the other desires, allowing them to exchange their goods directly without the need for money or other intermediaries. In this scenario, Rahul has cotton (which Anush wants), and Anush has wheat (which Rahul wants), leading to a mutual exchange of goods.
Answer: a. Double coincidence of want, Exchanging commodity for commodity.
Explanation: