This question was also attracted a lot of candidates most of whom scored relatively high marks. Candidates were required to define trade by barter, identify problems associated with trade by barter and to some forms of money in the (a), (b) and (c) parts of the question respectively. Most candidates had a good understanding of barter trade and the problems associated with barter in the (a) and (b) parts of the question but mixed up their explanation of the forms of money in the (c) part of the question . Candidates were expected to answer thus:

1. Barter is the system of exchanging goods or services for other goods and services.
2. 1. There is the problem of double coincidence of wants. People who have something to exchange have to look for someone who has what they want and is ready to accept what       they have. This involves a lot of time wasting.
   2. Future payments for goods and services are not possible since exchange is to meet the immediate needs of the people involved.
   3. There is the problem of non-uniformity of exchange rates because individuals fixed their own exchange rate for  goods and services.
   4. Large - scale production is discouraged as goods that cannot be exchanged immediately may get spoilt.
   5. Portability: The bulky nature of goods and the difficulty of carrying them around made barter system difficult.
   6. The problem of indivisibility: Certain commodities cannot be easily divided into smaller units in exchange for other goods.
3. 1. Commodity money is money that has value as commodity and also has value as money.   The commodity value is the value it possesses when not beingused as money. Gold and silver are examples of commodities that can be melted and used for jewelry and other ornaments. 
   2. Token money is money which has no intrinsic value. It has value only because it is accepted as a medium of exchange for goods and services. In the case of currency notes, the commodity content is worthless.
   3. Bank deposits are money deposited with financial institutions such as commercial banks   or a central bank. Bank deposits can be in the form of current account deposit or demand deposit.