What is one key benefit of cash over barter as a medium of exchange?

Study for the BAFT Certificate in Principles of Payments Test. Utilize flashcards and multiple-choice questions, with hints and explanations for each query. Prepare thoroughly for your exam!

Cash offers the key benefit of allowing for immediate settlement of transactions compared to barter. In a barter system, individuals must find a mutual agreement on the goods or services they wish to exchange, which can lead to delays and complications. This dependency on finding a willing counterpart for an exchange can slow down transactions significantly. Cash, on the other hand, serves as a direct medium that can be easily exchanged for goods or services without the need for negotiation or matching needs. This immediacy enhances the efficiency of transactions, making cash a more practical and effective medium of exchange in everyday commerce.

While other options present notable characteristics of cash, they do not capture the essence of immediacy in transaction settlements as effectively as this option does.

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