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Chapter 12: Problem 5

"A barter economy would have very few comedians." Do you agree or disagree with this statement? Explain your answer.

Short Answer

Expert verified
Whether a barter economy will have few comedians or not would broadly depend upon how the individuals in the economy value services like laughter and entertainment and whether such services can be easily exchanged for tangible goods and services. Therefore, the assertion can be both agreed or disagreed with, depending on the given conditions and individual values.

Step by step solution

01

- Understand Value of Comedians work in Barter Economy

In a barter economy, people directly exchange goods and services they produce for other goods and services they need. In this context, we need to consider what a comedian offers. A comedian offers laughter and entertainment which are intangibles.
02

- Determine Demand for Entertainment in Barter Economy

Next, we need to think about whether laughter and entertainment would be in demand in a barter economy. This can be subjective as it largely depends on the individual preferences of people in the economy. Entertainment as a service typically holds value, but this value might be hard to determine in a barter-based exchange system.
03

- Evaluate Ease of Exchange

Lastly, we need to consider how easy it would be to trade a comedian's services for tangible goods or services. It is potentially difficult to quantify the value of laughter and entertainment, making barter exchanges involving these types of services difficult.

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