In recent years, the paper currency in Venezuela has lost nearly all of its value, and most people have stopped accepting it in payment for goods and services. A professor at a university in Caracas, the country's capital, described how people have begun accepting eggs rather than currency. For example, the professor pays two eggs to park her car. Her university department uses cartons of eggs to pay computer programmers. She told a reporter that fruits and vegetables, such as onions or bananas, didn't work well, but "the egg is perfect." Source: Kejal Vyas, "How Fast Are Prices Skyrocketing in Venezuela? See Exhibit A: the Egg," Wall Street Journal, February 5, 2018. a. During this period in Venezuela, were eggs sewing as money at this professor's university? No, eggs were not serving as money because they do not satisfy a double coincidence of wants. Yes, eggs were serving as money in that people were accepting them in exchange for other goods and services. No, they were not serving as money because eggs have value independent of their use as money. 6.693.; Uncertain, the eggs would be considered money but only if Venezuela stopped using its paper currency. Do eggs meet all five criteria for serving as a medium of exchange? Criteria for Sewing as a Medium of Exchange Yes or No? Acceptabiliw Yes Standardized quality m Durability m Value relative to the asset's weight m Divisibility Yes b. What advantages do eggs have over fruits and vegetables in serving as a medium of exchange? Do eggs have any disadvantages? Venezuelans must prefer eggs to other fruits and vegetables, but eggs do not have a standard trade valuethat is, they can be traded individually or by the carton. Eggs don't require refrigerated storage like most fruits and vegetables. but eggs may not all look and taste the same. Eggs are more durable than some fruits and vegetables, but they may require extra care in handling. 57.097? The article must be incorrect. It is not possible for eggs or fruits and vegetables to serve as a medium of exchange. c. Why did this professor and other people at her university bother using eggs rather than trading goods and services directly with each other? CI- A. Using eggs is more efficient because trading directly with other people requires a double coincidence of wants. The people at this university must be condent that people like to eat eggs more than other fruits and vegetables. Using eggs allows the people at this university to specialize in the trading of eggs, thus giving them a comparative advantage in the egg market. OnlyAand C are correct. F" P .0 P7 All ofthe above are correct