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barter economy (PO)<br />One of the earliest forms of an economy in which goods are directly changed for other goods without using money as a medium of exchange. Prices are expressed in relative terms, e.g. X amount of A = Y amount of B. Transactions can be expensive as high search costs can be incurred in the pursuit of trading partners. However, to avoid taxation and create employment, in some areas of, for example, Canada and the UK, the exchange of services has replaced the usual market.
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