Which of the following is an example of the barter system?

A. investing money in the stock market

B. taking a friend to lunch in return for a favor

C. paying $120 for a pair of diamond studded shoes

D. exchanging a twenty dollar bill for two ten dollar bills

B. Taking a friend to lunch in return of a favor

Explanation:

Barter System is direct commodity / service to commodity/service exchange, without using money as an intermediary exchange medium. It is also called C to C exchange.

Eg : Two farmers exchanging their wheat & rice, A teacher teaching grocers' child in exchange of groceries from him.

So : A. Simple Investment, C. Money Purchase, D. Money Denomination exchange - neither are examples of Barter System.

B. Paying off a friend's favour in exchange of a service (being service-service exchange) is a relatable example.