Question 1

Compare and contrast a customs broker with a confirming house.

Accepted Answer

Customs brokers can help companies avoid...

Question 2

For U.S. firms, the most comprehensive source of information on export opportunities is the U.S. Department of Commerce.

Accepted Answer

A) True 
 B)False

Question 3

Jeff, the sales manager for Audio-Visual Systems, a small family business, is eager to get the company on an export path. The CEO of the company is not convinced, however. To convince the CEO, Jeff should point out that firms that do not export often

Accepted Answer

A)   face problems of currency conversion.
B)   lose out on significant opportunities for cost reduction.
C)   are able to reduce their unit costs.
D)   typically grow faster than those that do.
E)   can more easily leverage their technology in foreign markets.F) A) and B)
G) A) and C)

Question 4

When a bill of lading specifies that the carrier is obligated to provide a transportation service in return for a certain charge, it is acting as a

Accepted Answer

A)   contract.
B)   receipt.
C)   document of title.
D)   letter of credit.
E)   bill of exchange.F) B) and C)
G) C) and D)

Question 5

Germany is one of the world's least successful exporting nations because it simply lacks knowledge of opportunities.

Accepted Answer

A) True 
 B)False

Question 6

Many medium-size firms are not proactive in seeking export opportunities because

Accepted Answer

A)   they are familiar with the foreign market and do not find it challenging enough.
B)   the export market is similar to the home market in terms of legal and business practices.
C)   they are intimidated by the complexities and mechanics of exporting to foreign countries.
D)   domestic regulations limit their ability to export profitably.
E)   they can't recruit managers with the expertise needed to cultivate business in foreign countries.F) A) and B)
G) All of the above

Question 7

One characteristic of exporting that many first-time exporters do not realize is that

Accepted Answer

A)   many foreign customers require face-to-face negotiations on their home turf.
B)   large firms tend to wait for the world to come to them, rather than going out into the world to seek opportunities.
C)   exporters have the advantage of reduced paperwork and fewer formalities.
D)   medium-size and small firms are proactive about seeking opportunities for profitable exporting.
E)   firms that focus only on exporting often lose out on significant opportunities for growth and cost reduction.F) A) and E)
G) C) and D)

Question 8

Briefly describe the different forms of government-backed assistance that help potential U.S. exporters finance their export programs.

Accepted Answer

Prospective U.S. exporters can draw on t...

Question 9

What is the first step in a typical international trade transaction?

Accepted Answer

A)   The exporter agrees to ship under a letter of credit and specifies relevant information such as prices and delivery terms.
B)   The importer applies to a trusted third party (usually a bank)  for a letter of credit to be issued in favor of the exporter for the merchandise the importer wishes to buy.
C)   The importer places an order with the exporter and asks the exporter if he would be willing to ship under a letter of credit.
D)   The exporter ships the goods to the importer on a common carrier. An official of the carrier gives the exporter a bill of lading.
E)   The trusted third party (usually a bank)  issues a letter of credit in the importer's favor and sends it to the exporter's bank.F) None of the above
G) B) and C)

Question 10

Deli-Lite has a contract with a foreign client to provide low-fat deli trays. Deli-Lite does not have one of the items the foreign client wants on the trays, so it decides to contract with Green Source to fulfill this contract. What is this an example of?

Accepted Answer

A)   piggyback marketing
B)   an acquisition
C)   a customs broker
D)   licensing
E)   a remarketerF) A) and D)
G) C) and D)

Question 11

In international commerce, a person or business initiating a draft is known as the drafter and the party to whom the draft is presented is known as the draftee.

Accepted Answer

A) True 
 B)False

Question 12

Saudi Arabia agreed to purchase 5,000 air conditioning systems from Air-Cool Corp. with payment in the form of crude oil that is discounted 22 percent below posted world oil prices. This transaction is a form of

Accepted Answer

A)   countertrade.
B)   acquisition.
C)   licensing.
D)   greenfield venture.
E)   piggyback marketing.F) B) and E)
G) C) and E)

Question 13

Countertrade is most attractive for

Accepted Answer

A)   small exporters.
B)   large multinational enterprises.
C)   only U.S.-based firms.
D)   any firm in democratic nations.
E)   new companies.F) B) and D)
G) All of the above

Question 14

For an importer, what is a disadvantage of using a letter of credit for international transactions?

Accepted Answer

A)   It results in the importer losing control over the process of trading.
B)   It reduces the exporter's level of trust in the importer.
C)   It reduces the importer's ability to borrow funds for other purposes.
D)   It requires the importer to repay the loan even before the merchandise is sold.
E)   It is not issued at the importer's request.F) C) and E)
G) B) and C)

Question 15

The Eks-Plore Company exports outdoor gear for firms on the east coast of the United States. The company identifies companies in Europe and Asia that market and sell these products. Eks-Plore handles all documentation, logistics, and transportation for the products. What type of business is the Eks-Plore Company?

Accepted Answer

A)   export trading company
B)   wholly owned subsidiary
C)   franchise
D)   confirming house
E)   piggyback marketersF) C) and D)
G) A) and C)

Question 16

In terms of using a third party in international trade, title to the products is given to a bank by the exporter in the form of a document known as a

Accepted Answer

A)   merchandise bill.
B)   bill of lading.
C)   bill of exchange.
D)   draft.
E)   letter of credit.F) All of the above
G) D) and E)

Question 17

Barter is primarily used with trading partners who are not creditworthy or trustworthy.

Accepted Answer

A) True 
 B)False

Question 18

Neptune Corp. is exporting for the first time to Australia and has contracted with Pinkerton Imports in Melbourne for an initial order valued at $110,000. Neptune Corp. wants Pinkerton Imports to secure a document from a Melbourne bank that indicates the bank will pay Neptune Corp. $110,000 upon presentation of specified documents by the exporter. What document is Neptune Corp. asking for?

Accepted Answer

A)   bill of lading
B)   time draft
C)   letter of credit
D)   sight draft
E)   bill of exchangeF) None of the above
G) A) and B)

Question 19

Which institution within the U.S. Department of Commerce is dedicated to providing businesses with intelligence and assistance for attacking foreign markets?

Accepted Answer

A)   International Trade Administration
B)   Small Business Administration
C)   Federal Trade Commission
D)   Bureau of Competition
E)   Bank of New YorkF) C) and D)
G) All of the above

Question 20

Energy Source International builds a plant in Switzerland and agrees to take a certain percentage of the plant's output as partial payment for the contract. This type of countertrade is called a(n)

Accepted Answer

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

Exam 14: Exporting, Importing, and Countertrade

Jeff, the sales manager for Audio-Visual Systems, a small family business, is eager to get the company on an export path. The CEO of the company is not convinced, however. To convince the CEO, Jeff should point out that firms that do not export often

Correct Answer
verified

Correct Answer
verified

Saudi Arabia agreed to purchase 5,000 air conditioning systems from Air-Cool Corp. with payment in the form of crude oil that is discounted 22 percent below posted world oil prices. This transaction is a form of

Correct Answer
verified

Briefly describe the different forms of government-backed assistance that help potential U.S. exporters finance their export programs.

Correct Answer
verified
Prospective U.S. exporters can draw on t...
View Answer

In international commerce, a person or business initiating a draft is known as the drafter and the party to whom the draft is presented is known as the draftee.

Correct Answer
verified

Germany is one of the world's least successful exporting nations because it simply lacks knowledge of opportunities.

Correct Answer
verified

Correct Answer
verified

When a bill of lading specifies that the carrier is obligated to provide a transportation service in return for a certain charge, it is acting as a

Correct Answer
verified

Barter is primarily used with trading partners who are not creditworthy or trustworthy.

Correct Answer
verified

Countertrade is most attractive for

Correct Answer
verified

Compare and contrast a customs broker with a confirming house.

Correct Answer
verified
Customs brokers can help companies avoid...
View Answer

Deli-Lite has a contract with a foreign client to provide low-fat deli trays. Deli-Lite does not have one of the items the foreign client wants on the trays, so it decides to contract with Green Source to fulfill this contract. What is this an example of?

Correct Answer
verified

Many medium-size firms are not proactive in seeking export opportunities because

Correct Answer
verified

For U.S. firms, the most comprehensive source of information on export opportunities is the U.S. Department of Commerce.

Correct Answer
verified

Energy Source International builds a plant in Switzerland and agrees to take a certain percentage of the plant's output as partial payment for the contract. This type of countertrade is called a(n)

Correct Answer
verified

For an importer, what is a disadvantage of using a letter of credit for international transactions?

Correct Answer
verified

What is the first step in a typical international trade transaction?

Correct Answer
verified

Which institution within the U.S. Department of Commerce is dedicated to providing businesses with intelligence and assistance for attacking foreign markets?

Correct Answer
verified

One characteristic of exporting that many first-time exporters do not realize is that

Correct Answer
verified

In terms of using a third party in international trade, title to the products is given to a bank by the exporter in the form of a document known as a

Correct Answer
verified

Exam 14: Exporting, Importing, and Countertrade

Jeff, the sales manager for Audio-Visual Systems, a small family business, is eager to get the company on an export path. The CEO of the company is not convinced, however. To convince the CEO, Jeff should point out that firms that do not export often

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Saudi Arabia agreed to purchase 5,000 air conditioning systems from Air-Cool Corp. with payment in the form of crude oil that is discounted 22 percent below posted world oil prices. This transaction is a form of

Correct AnswerverifiedShow Answer

Briefly describe the different forms of government-backed assistance that help potential U.S. exporters finance their export programs.

Correct AnswerverifiedProspective U.S. exporters can draw on t...View AnswerShow Answer

In international commerce, a person or business initiating a draft is known as the drafter and the party to whom the draft is presented is known as the draftee.

Correct AnswerverifiedShow Answer

Germany is one of the world's least successful exporting nations because it simply lacks knowledge of opportunities.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When a bill of lading specifies that the carrier is obligated to provide a transportation service in return for a certain charge, it is acting as a

Correct AnswerverifiedShow Answer

Barter is primarily used with trading partners who are not creditworthy or trustworthy.

Correct AnswerverifiedShow Answer

Countertrade is most attractive for

Correct AnswerverifiedShow Answer

Compare and contrast a customs broker with a confirming house.

Correct AnswerverifiedCustoms brokers can help companies avoid...View AnswerShow Answer

Deli-Lite has a contract with a foreign client to provide low-fat deli trays. Deli-Lite does not have one of the items the foreign client wants on the trays, so it decides to contract with Green Source to fulfill this contract. What is this an example of?

Correct AnswerverifiedShow Answer

Many medium-size firms are not proactive in seeking export opportunities because

Correct AnswerverifiedShow Answer

For U.S. firms, the most comprehensive source of information on export opportunities is the U.S. Department of Commerce.

Correct AnswerverifiedShow Answer

Energy Source International builds a plant in Switzerland and agrees to take a certain percentage of the plant's output as partial payment for the contract. This type of countertrade is called a(n)

Correct AnswerverifiedShow Answer

For an importer, what is a disadvantage of using a letter of credit for international transactions?

Correct AnswerverifiedShow Answer

What is the first step in a typical international trade transaction?

Correct AnswerverifiedShow Answer

Which institution within the U.S. Department of Commerce is dedicated to providing businesses with intelligence and assistance for attacking foreign markets?

Correct AnswerverifiedShow Answer

One characteristic of exporting that many first-time exporters do not realize is that

Correct AnswerverifiedShow Answer

In terms of using a third party in international trade, title to the products is given to a bank by the exporter in the form of a document known as a

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Prospective U.S. exporters can draw on t...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Customs brokers can help companies avoid...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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