What is a barter system? What are its drawbacks?
Barter system is defined as the exchange of commodities without the mediation of money. In this system, economic agents trade goods directly without using a medium of exchange.
The primary drawback is the lack of double coincidence of wants, where an individual must find another person with a diametrically opposite demand for goods. Additionally, it is difficult to carry forward wealth because commodities are often perishable and cannot be stored for long periods. Holding stocks also requires a lot of space. Lastly, individuals spend considerable time and resources looking for people to exchange with, making the process inefficient.
Explanation
The answer is derived directly from the provided text. The definition is found in the second and fourth chunks ('Exchange of commodities without the mediation of money...'). The drawbacks are listed in the first and fourth chunks, specifically the lack of double coincidence of wants, the perishability of goods, storage costs, and the time/resources spent finding exchange partners.