Question 1

The bill of lading can function as collateral against which funds may be advanced to the exporter by its local bank.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following statements is true of exporting?

Accepted Answer

A)   It increases the trade deficit that nations have.
B)   Exporting leads to diseconomies of scope.
C)   It helps a firm achieve economies of scale
D)   Exporting is not beneficial to a country's economy.

Question 3

A draft is simply an order written by an exporter instructing an importer to pay a specified amount of money at a specified time.

Accepted Answer

A) True 
 B)False

Question 4

_____ is the direct exchange of goods and/or services between two parties without a cash transaction and is the simplest arrangement.

Accepted Answer

A)   Counterpurchase
B)   Barter
C)   Offset
D)   Switch trading

Question 5

The Foreign Credit Insurance Association does not provide coverage against political risks faced by exporters.

Accepted Answer

A) True 
 B)False

Question 6

In an international transaction involving bank as a third party,the exporter ships the product after _____.

Accepted Answer

A)   the bank receives materials from the importer
B)   receiving cleared payment through bank
C)   the importer has paid the bank
D)   the bank promises to pay on the importer's behalf

Question 7

The person or business initiating a draft is known as the _____.

Accepted Answer

A)   beneficiary
B)   drawee
C)   maker
D)   trustee

Question 8

Which of the following statements is true about Small Business Administration (SBA) ?

Accepted Answer

A)   It is the most comprehensive source of export opportunities information.
B)   SBA is a private organization managed by leaders of large corporate.
C)   The SBA employs trade officers throughout the United States.
D)   SBA offers help exclusively to small businesses that sell products within U.S.

Question 9

Compare and contrast time drafts and sight drafts.

Accepted Answer

Drafts fall into two categories,sight dr...

Question 10

The bill of lading does not serve as a document of title as such.

Accepted Answer

A) True 
 B)False

Question 11

A time draft is payable on presentation to the drawee

Accepted Answer

A) True 
 B)False

Question 12

Explain why barter is viewed as the most restrictive counter-trade arrangement.

Accepted Answer

The simplest form of countertrade is bar...

Question 13

Which of the following statements is true of reactive firms?

Accepted Answer

A)   Reactive firms consider a variety of markets for selling their products and services.
B)   They consider exporting only after their domestic market is saturated.
C)   They systematically scan foreign markets for profitable export opportunities.
D)   They create excess productive capacity and actively hunt for opportunities in foreign markets.

Question 14

Barter is viewed as the least restrictive countertrade arrangement.

Accepted Answer

A) True 
 B)False

Question 15

Hiring an EMC will help a novice exporter identify opportunities and navigate the paperwork involved in exporting.

Accepted Answer

A) True 
 B)False

Question 16

A bill of lading serves as a receipt,a contract,and a document of title.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is a common difficulty that traders face when exporting goods or services to other countries?

Accepted Answer

A)   Small firms tend to be more aggressive than larger firms in global trade.
B)   Governments do not provide much assistance to exporters.
C)   Growth opportunities are often limited in global markets.
D)   Exporters often face voluminous paperwork and complex formalities.

Question 18

As a receipt,the bill of lading indicates that the carrier _____.

Accepted Answer

A)   provides a written promise of payment before releasing the merchandise
B)   has obtained the merchandise described on the face of the document
C)   receives payment from a third-party such as a bank or trading house
D)   is obligated to provide a transportation service in return for a certain charge

Question 19

Which of the following statements is true of export credit insurance?

Accepted Answer

A)   Exporter will require more insurance if a letter of credit is used in transactions.
B)   The FCIA provides coverage against commercial risks and political risks.
C)   Private associations cannot offer export insurance in the United States.
D)   Organizations do not receive coverage against political risks of global trade.

Question 20

Describe the process involved in financing imports and exports using a letter of credit.Why has this system developed? What is the advantage of using this system?

Accepted Answer

The letter of credit is at the center of...

Exam 16: Exporting, Importing, and Countertrade

Compare and contrast time drafts and sight drafts.

Correct AnswerverifiedDrafts fall into two categories,sight dr...View AnswerShow Answer

Which of the following statements is true about Small Business Administration (SBA) ?

Correct AnswerverifiedShow Answer

In an international transaction involving bank as a third party,the exporter ships the product after _____.

Correct AnswerverifiedShow Answer

A draft is simply an order written by an exporter instructing an importer to pay a specified amount of money at a specified time.

Correct AnswerverifiedShow Answer

Describe the process involved in financing imports and exports using a letter of credit.Why has this system developed? What is the advantage of using this system?

Correct AnswerverifiedThe letter of credit is at the center of...View AnswerShow Answer

The Foreign Credit Insurance Association does not provide coverage against political risks faced by exporters.

Correct AnswerverifiedShow Answer

_____ is the direct exchange of goods and/or services between two parties without a cash transaction and is the simplest arrangement.

Correct AnswerverifiedShow Answer

The bill of lading can function as collateral against which funds may be advanced to the exporter by its local bank.

Correct AnswerverifiedShow Answer

As a receipt,the bill of lading indicates that the carrier _____.

Correct AnswerverifiedShow Answer

Which of the following statements is true of reactive firms?

Correct AnswerverifiedShow Answer

A time draft is payable on presentation to the drawee

Correct AnswerverifiedShow Answer

A bill of lading serves as a receipt,a contract,and a document of title.

Correct AnswerverifiedShow Answer

The bill of lading does not serve as a document of title as such.

Correct AnswerverifiedShow Answer

Which of the following is a common difficulty that traders face when exporting goods or services to other countries?

Correct AnswerverifiedShow Answer

Hiring an EMC will help a novice exporter identify opportunities and navigate the paperwork involved in exporting.

Correct AnswerverifiedShow Answer

Barter is viewed as the least restrictive countertrade arrangement.

Correct AnswerverifiedShow Answer

Explain why barter is viewed as the most restrictive counter-trade arrangement.

Correct AnswerverifiedThe simplest form of countertrade is bar...View AnswerShow Answer

Which of the following statements is true of export credit insurance?

Correct AnswerverifiedShow Answer

Which of the following statements is true of exporting?

Correct AnswerverifiedShow Answer

The person or business initiating a draft is known as the _____.

Correct AnswerverifiedShow Answer

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Drafts fall into two categories,sight dr...
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The letter of credit is at the center of...
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The simplest form of countertrade is bar...
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