How many prices would a trader of a particular good need to know in a barter economy with 20 goods?
A) 190
B) 100
C) 20
D) 40

Question

Quizplus · Accepted Answer

In a barter economy with 20 goods, a trader would need to know the prices for each combination of goods. The formula to calculate the number of prices needed is (n*(n-1))/2, where n is the number of goods. So in this case, the trader would need to know (20*(20-1))/2 = 190 prices. Therefore, the best choice is A.

How Many Prices Would a Trader of a Particular Good