Barter system

Meaning:

The barter system is the oldest way of trading where people exchanged goods and services directly without using money.

Example:

If a farmer gives wheat to a potter in exchange for pots, that is a barter trade.

How it worked:

• People exchanged what they produced, like food or           clothes.
• They agreed on the value of what they were trading.
• There was no use of coins or money.

Why it stopped:

The barter system became hard to use because it was difficult to find someone who wanted what you had. For example, if a farmer wanted clothes but the weaver didn't need wheat, they couldn't trade.

Advantages:

• Simple and direct way to exchange.
• No need for money.

Disadvantages:

• Hard to find someone who wants what you offer.
• No standard way to measure value.