Trade and Exchange

Trade and Exchange — page 5 — Trade and Exchange To make this exchange happen happen the fruit owner needs someone willing to trade spices for fruit Then the traders must agree upon a price How many fruits equal a handful of spices If the traders traveled great distances by horse to a central central marketplace timing was key The spice trader would not trade his goods for spoiled fruits Trading goods and services online allows bartering between people living nearby or far away Online searches can identify safe sites for online bartering Today people also barter online Some online bartering sites allow trades for personal care services clothing home and office space and transportation For example in 2017 Home Exchange operated in more than 150 countries allowing its members to trade homes for vacation stays SwapStyle members trade clothes shoes make-up and accessories And BabysitterExchange is a co-op that allows community members to trade services like babysitting and tutoring 8

Trade and Exchange — page 6 — Barter It PROS OF BARTERING In a barter exchange traders traders or parties seek to gain from an exchange A trader may be willing to trade a good that she produced too much of for other goods Or a party may value another person’s good more than her own and be willing to exchange Either way bartering bartering is a way for people to obtain goods they need or want When people from different different countries or regions barter they gain access to goods they might not have locally Bartering can expand the pool of available goods A person may own a good like a jacket that she no longer values as much as when she first bought it Trading is a way to exchange these goods for others People also barter services such as tutoring housesitting housesitting and babysitting With services people are not exchanging exchanging physical items Instead they are trading their time and effort Traders may offer services based on what they are 9

Trade and Exchange — page 7 — Trade and Exchange good at For example a repairman may offer to fix a store's air conditioning in exchange for store credit Today some com panies engage in bartering called corporate trade A media company might provide free tickets to a show in exchange for free hotel rooms Six Flags once bartered free passes to its amusement parks with Orion Trading in exchange for free TV advertisements During economic downturns like recessions people have less income to spend Bartering allows people to obtain goods and services without using income It can also reduce personal expenses Suppose a house painter is short of cash Businesses sometimes exchange goods and services with other businesses Amusement parks might barter entry tickets for free advertisement ADMISSION 5 TEXAS ADMISSION 5

Trade and Exchange — page 8 — Barter It and wants to get a haircut She knows a hairdresser who wants his house painted The painter could do some work for the hairdresser in exchange for haircuts Or let’s say a new online advertising and branding agency needs an accountant It can provide a logo and help design a website for a young accountant accountant in exchange for free accounting services This kind of bartering bartering happens a lot in today’s economy Bartering Today The International Reciprocal Trade Association IRTA is a global trade association with more than 100 barter exchanges corporate trade companies and complementary complementary currency organizations A barter exchange consists of two parties that agree by contract to trade property or services Corporate trade involves trade credits that companies use to obtain goods and services from one another Complementary currency is a different kind of currency than a country’s official currency It can be used to obtain goods and services According to the IRTA bartering generated about 12 billion from more than 400,000 companies worldwide in 2011 11

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