2 Answers | Add Yours
The lack of a double coincidence of wants is a major reason why it is important to have a system of money.
Without money, we need to barter. But barter depends on a double coincidence of wants. If you and I are to barter, I must have what you want and I must want what you have. The same applies to you. If we do not meet this criterion, we lack a double coincidence of wants. If I have what you want, but you don't have what I want, we do not have a double coincidence of wants and we can't trade.
Because of this, it is much better to have a system of money. Then we do not need to have this double coincidence.
This is one of the difficulties of the barter system.
This is when two people are willing to exchange goods they have which each other but doiuble coincidence of wants arise like this(below). let me explain to you with an example:-
if Person A wants what person B has , person B must also want what person A has. So this would mean u have to find a person who wants ur product and make sure the person has the product u want and is willing to give. So this is a very rare situation to obtain. Mney overcomes this probem.
We’ve answered 319,816 questions. We can answer yours, too.Ask a question