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  • Part A Organisational Principles Section 1 The Nature of Business

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    The document discusses the development of barter and the role of money. It defines barter as the exchange of goods without the use of money. A key issue with barter is the "double coincidence of wants", where both parties in an exchange must want what the other is offering. Money was developed to overcome disadvantages of barter like inefficient rates of exchange and lack of a common store of value. The functions of money include being a medium of exchange, store of value, and unit of account. Modern instruments of exchange discussed include e-commerce, bills of exchange, debit cards, credit cards, and mobile wallets.

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    The document discusses the development of barter and the role of money. It defines barter as the exchange of goods without the use of money. A key issue with barter is the "double coincidence of wants", where both parties in an exchange must want what the other is offering. Money was developed to overcome disadvantages of barter like inefficient rates of exchange and lack of a common store of value. The functions of money include being a medium of exchange, store of value, and unit of account. Modern instruments of exchange discussed include e-commerce, bills of exchange, debit cards, credit cards, and mobile wallets.

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    43 views3 pages

    Part A Organisational Principles Section 1 The Nature of Business

    Uploaded by

    StateofMind Hugo
    The document discusses the development of barter and the role of money. It defines barter as the exchange of goods without the use of money. A key issue with barter is the "double coincidence of wants", where both parties in an exchange must want what the other is offering. Money was developed to overcome disadvantages of barter like inefficient rates of exchange and lack of a common store of value. The functions of money include being a medium of exchange, store of value, and unit of account. Modern instruments of exchange discussed include e-commerce, bills of exchange, debit cards, credit cards, and mobile wallets.

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    of 3

    Part A Organisational principles

    Section 1 The nature of business

    1.1 Explain the development of barter

    1 The exchange of goods without the use of money is defined as


    (A) purchase. A

    (B) barter. B

    (C) transaction. C

    (D) transfer. D

    2 ‘Double coincidence of wants’ is an issue associated with the system of


    (A) barter. A

    (B) sale. B

    (C) transfer. C

    (D) donations. D

    3 Which of the following is a disadvantage of the barter system?


    I The rate of exchange
    II Storage of wealth
    III Acquisition of goods
    (A) I and II only A

    (B) III only B

    (C) I and III only C

    (D) I, II and III D

    CSEC MCQ POB.indd 1 24/01/18 10:43 AM


    1.2 Describe the role of money

    4 Any commodity accepted as a measure of value and a medium of exchange is called


    (A) trade. A

    (B) paper. B

    (C) money. C

    (D) finance. D

    5 The feature of money which states it must be identical in look, size and weight is called
    (A) acceptable. A

    (B) divisible. B

    (C) homogenous. C

    (D) portable. D

    6 John told his sister Susan that money must be able to pass from hand to hand without
    being easily destroyed. John is describing which feature of money?
    (A) Portable A

    (B) Durable B

    (C) Divisible C

    (D) Acceptable D

    7 Which of the following is not a function of money?


    (A) Medium of exchange A

    (B) Standard of value B

    (C) Means of deferred payment C

    (D) Standard of validity D

    CSEC MCQ POB.indd 2 24/01/18 10:43 AM


    1.3 Identify the instruments of exchange

    8 Business transactions done through the internet are called


    (A) e-commerce. A

    (B) e-currency. B

    (C) trans-currency. C

    (D) inter-commerce. D

    9 A written order by one party to another to pay a certain sum by a certain time is
    known as a
    (A) bank draft. A

    (B) credit card. B

    (C) bill of exchange. C

    (D) cheque. D

    10 Yvette is unable to buy a new purse because the store does not accept cash transactions.
    Which financial instrument allows her to access her funds electronically?
    (A) Money order A

    (B) Debit card B

    (C) Credit card C

    (D) Mobile wallet D

    11 Susan is unable to go to the bank, so she used her residential phone to conduct banking
    transactions. Susan is engaged in
    (A) tele-commerce. A

    (B) e-banking. B

    (C) inter-banking. C

    (D) telebanking. D

    CSEC MCQ POB.indd 3 24/01/18 10:43 AM

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