Exam 19: Financing International Trade

____ is not a type of program offered by Ex-Imbank.

In an open account transaction, the exporter ships the goods to the importer but retains title to the goods until they have been sold.

The Direct Loan Program is administered by the:

Consider an importer that issues a promissory note to pay for the imported capital goods over a period of five years. The notes are extended to an exporter who sells them at a discount to a bank. This reflects:

The commission earned by the bank for accepting a draft is reflected in the all-in-rate.

The term counterpurchase denotes the exchange of goods between two parties under two distinct contracts expressed in monetary terms.

All types of foreign trade transactions in which the sale of goods to one country is linked to the purchase or exchange of goods from that same country are called countertrade.

In a countertrade transaction, banks on both ends act as intermediaries in the processing of shipping documents and the collection of payment.

The Working Capital Guarantee Program and the Medium-term Guarantee Program are offered by the:

If shipment is made under a forfaiting draft, the exporter is paid once shipment has been made and the draft is presented to the buyer for payments.

From a bank's viewpoint, issuing a letter of credit is analogous to making a loan as far as risk is concerned.

The Working Capital Guarantee Program is administered by the:

MNCs can use ____ to sell their existing accounts receivable as a means of obtaining cash.

Which of the following is not a payment method used for international trade?

Which of the following payment terms provides the supplier with the greatest degree of protection?

Under prepayment, the exporter will not ship the goods until the buyer has remitted payment to the exporter.

Under a ____, the exporter is paid once shipment has been made and the draft is presented to the buyer for payment; under a ____, the exporter provides instructions to the buyer's bank to release shipping documents against acceptance, by the buyer, of the draft.

Consider an exporter that sells its accounts receivables off to another firm that becomes responsible for obtaining cash from the various importers. This reflects:

A draft drawn on and accepted by a bank is called a banker's acceptance.

Which of the following is not a payment method used for international trade?