Exchange in the international market which does not involve the use of money as a medium is known as?
Answer Details
The exchange in the international market that does not involve the use of money as a medium is known as "counter trade."
Counter trade is a form of international trade where goods or services are exchanged for other goods or services instead of using money as a medium of exchange. This can take many forms, such as barter, offset agreements, and buyback agreements.
Barter involves the direct exchange of goods or services between two parties, without the use of money. For example, a company in one country may trade machinery with a company in another country in exchange for raw materials.
Offset agreements are contracts between two parties where one party agrees to purchase goods or services from the other party in exchange for an offset in the form of a purchase of goods or services from the first party.
Buyback agreements involve the sale of goods or services by one party to another, with the condition that the buyer agrees to purchase a certain amount of goods or services from the seller in the future.
Counter trade is often used in situations where a country may have limited access to foreign currency, or where there may be restrictions on the import or export of certain goods or services.