Quiz-3 (2)

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Question 1 (1 point) Saved Listen Your client wants to export to a new geographical area. What possible payment risk must be considered first? Question 1 options: Failure of the buyer to honor his contractual obligations The risk of the date of cargo readiness The risk of loss due to economic, social, legal and political conditions The risk of loss or damage to goods in transit Question 2 (1 point) Saved Listen What is the role of a freight forwarder with an international payment transaction? Question 2 options: To advise on payment risks in international business To advise on sources of credit To negotiate international payments on behalf of the client To assist in negotiating sales contracts Question 3 (1 point) Saved Listen When a product is shipped to the buyer without prior payment or without any bank involvement, this is an example of: Question 3 options: documentary collection open account letter of credit payment in advance- wrong

Question 4 (1 point) Saved Listen The seller has presented the documents correctly but the buyer is not paying the draft in a documentary collection (dc) transaction. If payment isn't forthcoming the bank is responsible to: Question 4 options: advise the buyer and remit payment to the seller consult URC522 to determine what to do remit payment and debit the buyers account advise the buyer that they must pay within 30 days Question 5 (1 point) Saved Listen This payment option is advantageous to the buyer but puts the seller at maximum risk: Question 5 options: advance payment open account documentary collection documentary letter of credit Question 6 (1 point) Saved Listen Which document would you (as a buyer), or the bank (under d/p), would you check to see if delivery conforms, in a CIF contract? Question 6 options: The Inspection Certificate

the Certificate of Origin The Bill of Lading The Insurance Certificate The Commercial Invoice Question 7 (1 point) Saved Listen When documentary collection is the agreed method of payment, and it is agreed that goods are sold documents against payment (D/P), the exporter's risk is of non-payment is Question 7 options: high total low zero Question 8 (1 point) Saved Listen A contract using a documentary collection with the term D/P (documents against payment) means that the payment to the seller will ____________ upon presentation of the documents and the draft. Question 8 options: be made at maturity not be made at all be made in 10 days be made immediately Question 9 (1 point) Saved Listen

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____________ is least likely to be advised to the seller when a foreign currency cannot be freely bought (currency restrictions) Question 9 options: Open account Payment in advance Documentary collection Letter of credit Question 10 (1 point) Saved Listen How can foreign exchange risk be minimized? Question 10 options: By using the advance payment method It cannot be minimized, it is the importer's risk By always using open account as the method of payment By agreeing to a fixed exchange rate at the outset Question 11 (1 point) Saved Listen Which one of the following payment methods involves the parties using the services of a bank but the banks does not guarantee to pay the seller. Question 11 options: bill of lading bill of exchange documentary collections documentary letter of credit Question 12 (1 point) Saved

Listen When a product is shipped with prior payment, this is an example of: Question 12 options: documentary collection letter of credit payment in advance open account Question 13 (1 point) Saved Listen The main risk for the Exporter/Drawer in a documentary collections transaction that makes “Documents Against Acceptance” riskier than “Documents Against Payment” is Question 13 options: Exchange rate risk that the exporter/drawer might face while awaiting payment Political risk in countries that have restrictions on foreign exchange There is no added risk for the drawer, it is the drawee who has the higher risk The drawer must wait until the maturity date for payment even though the buyer has taken possession of the goods Question 14 (1 point) Saved Listen Under documentary collections, which party is the drawee? Question 14 options: The freight forwarder The exporter The shipper The importer Question 15 (1 point)

Saved Listen Which document is normally required in a documentary collection Question 15 options: a negotiable shippers bill of lading a non-negotiable multi modal bill of lading a negotiable to order bill of lading a non-negotiable bill of lading Submit Quiz 15 of 15 q

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