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ch 1920

Authored by rita j

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ch 1920
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9 questions

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1.

MULTIPLE CHOICE QUESTION

5 sec • 1 pt

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

accounts receivable financing.

consignment.

factoring.

a letter of credit.

2.

MULTIPLE CHOICE QUESTION

5 sec • 1 pt

Consider a bank that acknowledges that it will make payment on behalf of a computer importer after the bank receives documents showing that the computers have been shipped to the importer. This reflects:

accounts receivable financing.

forfaiting

letters of credit

factoring

3.

MULTIPLE CHOICE QUESTION

5 sec • 1 pt

When products are shipped under a ______, the exporter is paid once the shipment is made and the draft is presented to the importer for payment.

consignment arrangement

time draft

prepayment arrangement

sight draft

4.

MULTIPLE CHOICE QUESTION

5 sec • 1 pt

An exchange of products between two parties under two distinct contracts expressed in monetary terms is:

compensation.

a counterpurchase.

factoring.

accounts receivable financing.

5.

MULTIPLE CHOICE QUESTION

5 sec • 1 pt

The risk to the exporter is highest with the ____ payment method.

prepayment

letter of credit

sight draft

open account

6.

MULTIPLE CHOICE QUESTION

5 sec • 1 pt

Countries with a ____ rate of inflation tend to have a ____ interest rate.

high; low

low; high

high; high

high; low AND low; high

7.

MULTIPLE CHOICE QUESTION

10 sec • 1 pt

If Boston Co. has ____ in Canadian dollars, it could reduce its exposure to exchange rate risk by borrowing ____.

payables; U.S. dollars

receivables; U.S. dollars

payables; Canadian dollars

receivables; Canadian dollars

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