a) Outline five problems of barter trade. b) Explain to Domingo five benefits of using...

Explanation

(a) The problems of barter include:

• Double co-incidence of wants;
• No fixed rate of interest;
• Wastage of time and effort;
• Indivisibility of goods;
• Discouraging borrowing and lending/no deferred payment;
• Difficulty in storing wealth;
• Bulkiness of goods;
• Measurement of value of goods.

(b) Benefits Domingo could derive by using computers in the conduct of his business:

• He could use a computer to communicate with his suppliers and customers through email faster;
• The use of spread sheet and accounting software could help him to keep his accounts better than doing it manually (accurate and reliable data);
• He could search for cars available for sale as well as potential buyers through the internet on the computer;
• The use of computer reduces the time and cost of doing business;
• Information about suppliers, debtors and potential customers could be stored in the computer for ease of retrieval;
• Diagnostics of the state of vehicles he purchases could be done by using a computer system/ to detect problem;
• He could use a computer to transfer funds as well as know the state of his accounts;
• He could use a computer to secure his premises through the use of close circuit television (CCTV);
• He could use a computer to monitor his vehicles with the help of tracking device installed in the vehicle in case of theft;
• He could use computer for confidentiality as access to information is not possible without the knowledge of the password;
• Data processed on the computer are more accurate and reliable than the one manually done