Question 1

Unhappy with the speed with which the company's export initiative was going, the CEO called Ken, the person in charge of exports at Resolve Products. What aspect of exporting can Ken use to validate the slow progress of Resolve Products' efforts?

Accepted Answer

A)   The U.S. government does not provide any help for exporters.
B)   Novice exporters tend to overestimate the time required to cultivate business in foreign countries.
C)   Exporters often face voluminous paperwork, complex formalities, and many potential delays and errors.
D)   Small firms are usually familiar with foreign market opportunities.
E)   Large firms do not consider exporting until their domestic market is saturated.F) A) and B)
G) B) and D)

Question 2

The mission of the Foreign Credit Insurance Association is to provide financing aid that will facilitate exports, imports, and the exchange of commodities between the United States and other countries.

Accepted Answer

A) True 
 B)False

Question 3

The Export-Import Bank provides financing aid to prospective U.S. exporters.

Accepted Answer

A) True 
 B)False

Question 4

How does a lack of trust affect firms engaged in international trade? How can the problem be solved?

Accepted Answer

Firms engaged in international trade hav...

Question 5

In international commerce, time drafts are non-negotiable instruments.

Accepted Answer

A) True 
 B)False

Question 6

Countertrade arose in the 1960s as a way to purchase imports for ________, whose currency was nonconvertible.

Accepted Answer

A)   the United States
B)   the Soviet Union
C)   Germany
D)   Japan
E)   African countriesF) A) and B)
G) B) and D)

Question 7

Only large companies have benefited significantly from the moneymaking opportunities of exporting.

Accepted Answer

A) True 
 B)False

Question 8

When a time draft is presented to a drawee, the company signifies acceptance of it by

Accepted Answer

A)   delivering the goods immediately.
B)   paying the draft amount immediately.
C)   providing a collateral for the amount specified in the bill.
D)   writing or stamping a notice of acceptance on its face.
E)   selling the draft to an investor at a discount from its face value.F) A) and B)
G) A) and D)

Question 9

What is a disadvantage of barter as a countertrade arrangement?

Accepted Answer

A)   It is a very complex arrangement.
B)   If goods are exchanged simultaneously, one party ends up financing the other.
C)   Firms engaged in barter run the risk of having to accept goods they do not want or cannot use.
D)   It involves huge cash transactions.
E)   It cannot be used in transactions with trading partners who are not creditworthy.F) B) and C)
G) B) and E)

Question 10

What is countertrade? When can it be used?

Accepted Answer

Countertrade is an alternative means of ...

Question 11

A medium-size skincare company based in Minnesota plans to expand operations into four countries in Europe. The company decides to hire a(n)  ________ that can help the company with the specific laws and documentation requirements for imports for the four countries.

Accepted Answer

A)   confirming house
B)   customs broker
C)   export packaging company
D)   franchisee
E)   buying agentF) C) and D)
G) B) and C)

Question 12

One way the U.S. Department of Commerce helps potential exporters is by

Accepted Answer

A)   overseeing volunteers with international trade experience.
B)   assembling a "comparison shopping service" for countries that are major markets for U.S. exports.
C)   coordinating a nationwide group of international trade attorneys who provide free initial consultations to small businesses.
D)   providing export specialists who act as the export marketing departments for their client firms.
E)   starting exporting operations for firms until they are well established.F) A) and E)
G) C) and D)

Question 13

Full-Sole Shoes concludes a counterpurchase agreement with Japan for which it receives some counterpurchase credits. Full-Sole Shoes does not want any foreign goods, however, so it sells the credits to a third-party trading house at a discount. The trading house finds a firm that can use the credits and sells them at a profit. This is an example of

Accepted Answer

A)   barter.
B)   switch trading.
C)   an offset.
D)   a buyback.
E)   compensation.F) A) and C)
G) C) and D)

Question 14

What is an advantage of having a letter of credit?

Accepted Answer

A)   It allows payment for merchandise after its delivery.
B)   It facilitates an exporter to obtain pre-export financing.
C)   It allows an exporter to get a higher price for his or her goods.
D)   It helps exporters incur lower shipping costs.
E)   It does not require the importer to pay any fee.F) A) and D)
G) A) and E)

Question 15

What is the purpose of a letter of credit?

Accepted Answer

A)   It states that the bank will pay a specified sum of money to a beneficiary on presentation of particular, specified documents.
B)   It is a document written by an exporter instructing an importer to pay a specified amount of money at a specified time.
C)   It serves as a receipt, a contract, and a document of title.
D)   It indicates that the carrier has received the merchandise described on the face of the document.
E)   It allows buyers to obtain possession of merchandise without signing a formal document acknowledging his or her obligation to pay.F) D) and E)
G) C) and D)

Question 16

Describe the mission of the Ex-Im Bank.

Accepted Answer

The Export-Import Bank, often referred t...

Question 17

The most restrictive countertrade arrangement is

Accepted Answer

A)   counterpurchase.
B)   offset.
C)   barter.
D)   switch trading.
E)   buyback.F) B) and E)
G) A) and E)

Question 18

Sogo shosha in Japan are a type of

Accepted Answer

A)   freight forwarder.
B)   trading house.
C)   currency exchange.
D)   production site.
E)   customer service center.F) A) and D)
G) A) and C)

Question 19

An offset agreement limits the flexibility to choose the goods an exporter wants to purchase.

Accepted Answer

A) True 
 B)False

Question 20

A time draft is a negotiable instrument, which means that it

Accepted Answer

A)   has no value given the deferred nature of the document.
B)   is generally not preferred in international transactions.
C)   can be sold to an investor.
D)   is also known as a bill of lading.
E)   cannot be transferred.F) B) and E)
G) C) and D)

Exam 14: Exporting, Importing, and Countertrade

Correct Answer
verified

A time draft is a negotiable instrument, which means that it

Correct Answer
verified

What is countertrade? When can it be used?

Correct Answer
verified
Countertrade is an alternative means of ...
View Answer

Only large companies have benefited significantly from the moneymaking opportunities of exporting.

Correct Answer
verified

One way the U.S. Department of Commerce helps potential exporters is by

Correct Answer
verified

Countertrade arose in the 1960s as a way to purchase imports for ________, whose currency was nonconvertible.

Correct Answer
verified

What is the purpose of a letter of credit?

Correct Answer
verified

When a time draft is presented to a drawee, the company signifies acceptance of it by

Correct Answer
verified

The mission of the Foreign Credit Insurance Association is to provide financing aid that will facilitate exports, imports, and the exchange of commodities between the United States and other countries.

Correct Answer
verified

The most restrictive countertrade arrangement is

Correct Answer
verified

How does a lack of trust affect firms engaged in international trade? How can the problem be solved?

Correct Answer
verified
Firms engaged in international trade hav...
View Answer

Describe the mission of the Ex-Im Bank.

Correct Answer
verified
The Export-Import Bank, often referred t...
View Answer

Sogo shosha in Japan are a type of

Correct Answer
verified

The Export-Import Bank provides financing aid to prospective U.S. exporters.

Correct Answer
verified

A medium-size skincare company based in Minnesota plans to expand operations into four countries in Europe. The company decides to hire a(n) ________ that can help the company with the specific laws and documentation requirements for imports for the four countries.

Correct Answer
verified

What is an advantage of having a letter of credit?

Correct Answer
verified

An offset agreement limits the flexibility to choose the goods an exporter wants to purchase.

Correct Answer
verified

What is a disadvantage of barter as a countertrade arrangement?

Correct Answer
verified

Unhappy with the speed with which the company's export initiative was going, the CEO called Ken, the person in charge of exports at Resolve Products. What aspect of exporting can Ken use to validate the slow progress of Resolve Products' efforts?

Correct Answer
verified

In international commerce, time drafts are non-negotiable instruments.

Correct Answer
verified

Exam 14: Exporting, Importing, and Countertrade

Correct AnswerverifiedShow Answer

A time draft is a negotiable instrument, which means that it

Correct AnswerverifiedShow Answer

What is countertrade? When can it be used?

Correct AnswerverifiedCountertrade is an alternative means of ...View AnswerShow Answer

Only large companies have benefited significantly from the moneymaking opportunities of exporting.

Correct AnswerverifiedShow Answer

One way the U.S. Department of Commerce helps potential exporters is by

Correct AnswerverifiedShow Answer

Countertrade arose in the 1960s as a way to purchase imports for ________, whose currency was nonconvertible.

Correct AnswerverifiedShow Answer

What is the purpose of a letter of credit?

Correct AnswerverifiedShow Answer

When a time draft is presented to a drawee, the company signifies acceptance of it by

Correct AnswerverifiedShow Answer

The mission of the Foreign Credit Insurance Association is to provide financing aid that will facilitate exports, imports, and the exchange of commodities between the United States and other countries.

Correct AnswerverifiedShow Answer

The most restrictive countertrade arrangement is

Correct AnswerverifiedShow Answer

How does a lack of trust affect firms engaged in international trade? How can the problem be solved?

Correct AnswerverifiedFirms engaged in international trade hav...View AnswerShow Answer

Describe the mission of the Ex-Im Bank.

Correct AnswerverifiedThe Export-Import Bank, often referred t...View AnswerShow Answer

Sogo shosha in Japan are a type of

Correct AnswerverifiedShow Answer

The Export-Import Bank provides financing aid to prospective U.S. exporters.

Correct AnswerverifiedShow Answer

A medium-size skincare company based in Minnesota plans to expand operations into four countries in Europe. The company decides to hire a(n) ________ that can help the company with the specific laws and documentation requirements for imports for the four countries.

Correct AnswerverifiedShow Answer

What is an advantage of having a letter of credit?

Correct AnswerverifiedShow Answer

An offset agreement limits the flexibility to choose the goods an exporter wants to purchase.

Correct AnswerverifiedShow Answer

What is a disadvantage of barter as a countertrade arrangement?

Correct AnswerverifiedShow Answer

Unhappy with the speed with which the company's export initiative was going, the CEO called Ken, the person in charge of exports at Resolve Products. What aspect of exporting can Ken use to validate the slow progress of Resolve Products' efforts?

Correct AnswerverifiedShow Answer

In international commerce, time drafts are non-negotiable instruments.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Countertrade is an alternative means of ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Firms engaged in international trade hav...
View Answer

Correct Answer
verified
The Export-Import Bank, often referred t...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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