When a barter system is used in a country, it means that a person buys product A and pays for it with other items that are of equal value to product A according to the norms of the country. Prices are expressed in terms of other goods.



In the illustration, a loaf of bread can be exchanged for two quarts of milk, and two quarts of milk for one loaf of bread. A loaf of bread for two quarts of milk