What if there was no money?


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    Information

  • There are 40 questions on this question paper.
  • Each question carries one mark.
  • Dedicate no more than 20 minutes to each section
  • The answers are to be written in lowercase
  • The test duration is 60 minutes
  • Complete answering questions from all 3 Sections before clicking on the Submit button

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What if there was no money?

PASSAGE

"2 packets corn flakes - check, 1 bottle of Jam - check, 500g ketchup - check", Rima read the menu as her mother picked up groceries and placed them in their cart. They moved from one aisle to another getting groceries and marking a tick against each item they bought from their list.

"This is so tedious! When will we go home?", exclaimed Rima in a tired voice. "We can go home as soon as we buy all the groceries", told her mother.

"I want to go home right now! I'm bored out of my mind!", Rima threw a tantrum.

"Rima, dear, we should always complete our chores on time. As soon as we finish our grocery shopping, we can go home. Till then, I can tell you something interesting to get rid of your boredom", explained Rima's mother calmly.

"Do you know how people used to buy groceries in ancient times when there was no money?" asked Rima's mother.

"I don't know", Rima replied after giving it some thought.

"For nearly as long as people have existed, they have been sharing, exchanging, selling, and consuming goods. Even when there was no money. When there was no money, people used to exchange things with each other in trade. Like if I was a wheat farmer in ancient times, do you know what I would do after cultivating my crop?", Rima's mother asked her.

"Umm. Sell it?", Rima guessed.

"No, silly. How could I sell when there was no money? I would separate enough wheat for my family and my kingdom's ruler and then I would exchange the rest with other people. Like if you needed shoes, I would give some wheat to the shoe maker to get you some shoes. For clothes, I would go to the cloth weaver and give him some wheat too in exchange for clothes. If I wanted to buy a sheep, I would exchange the wheat with a shepherd. Just like this, people used to exchange all kinds of things with each other. It could be cows, goats, camels, sugar, wheat, rice, clothes or anything else that they needed. This is called the barter system", Rima's mom explained. A Free App to Facilitate a Local Barter System | Permaculture Noosa

"Oh, this is fascinating. If we still had a barter system, I would barter my beans for chocolates.", Rima said after some thinking and her mother laughed.

"Why did we stop using this barter system? How will I exchange my beans for chocolates without the barter system?", Rima asked in an annoyed tone.

"That's because the barter system was quite inefficient. If you wanted to get a certain good, you would have to find a person who had that particular good and was willing to exchange it for something you had. Doing so was very time consuming and tedious.", her mother explained. "You find grocery shopping in a supermarket tedious. How would you go about finding someone who would give you chocolates for your beans?", her mother laughed.

"Hmmm...true.", Rima started thinking.

That day Rima went home and asked her sister, "Di, you like beans, right? Would you like to have my beans and give me a chocolate in return?"

"Okay, I'll give you one piece of chocolate for all the beans.", her sister replied.

"Only one piece of chocolate for all the beans?", Rima was shocked and went to her mom and told her about it. "Yes, dear, this is another drawback of the barter system. It is very difficult to compare all the goods involved in the barter system. This is why a lot of the barter system transactions can be extremely unfair.", Rima's mom explained to her.

Questions

Answer the following questions.



Q.1

What is barter system?




Q.2

Why do you think people stopped using the barter system for trade?




Q.3

Can you think of some ways in which the barter system can be beneficial? List them below:




Q.4

In ancient times, do you think the barter system could have been more beneficial to some people than others? Elaborate your answer.





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