why is money transaction system better than barter system

1. Transanctions are made in money as a person holding money can easily exchange it for any good or service he wants. Money acts as an intermediate in the process of exchange. A person prefers to get payment in money and then exchange it for a commodity he wants. Eg: A blacksmith wants to buy shoe. He will first exchange his tools for money in market and then exchange the money for shoes from the trader.

2. Barter system is an exchange process based on double coincidence of wants in which both the parties agree to sell and buy each others products.

Drawback: It is a difficult task to find two people having the specific need. It is also difficult to compare value of a good in any other goods terms.

3. MNCs set up partnership with local companes.

They closely compete with the local companies or buys them up. Buying is the most common method as MNCs have a lot of money]

They place orders with the local companies and then sell the goods under their own brand.

Hope these answers help.