Question 1

If a firm builds a plant in a country and agrees to take a certain percentage of the plant's output as partial payment for the contract,this is known as an offset.

Accepted Answer

A) True 
 B)False

Question 2

Mechanisms for financing exports and imports have evolved over the centuries in response to a problem that can be particularly acute in international trade: ________________.

Accepted Answer

A)  the letter of credit 
B)  the lack of trust 
C)  government regulations 
D)  undeveloped international political system 
E)  currency exchange rate differences

Question 3

Who are considered to be the masters of countertrade?

Accepted Answer

A)  the sogo shosha 
B)  small firms 
C)  DFAIT 
D)  the Canadian Commercial Corporation 
E)  the World Bank

Question 4

Exporters are typically faced with what problems?

Accepted Answer

A)  lots of paperwork 
B)  complex formalities 
C)  many potential delays 
D)  potential errors 
E)  all of these answers are correct

Question 5

The most restrictive countertrade arrangement is:

Accepted Answer

A)  counter-purchase 
B)  offset 
C)  buybacks 
D)  switch trading 
E)  barter

Question 6

For novice exporters,it is recommended that they hire an EMC to help identify opportunities and navigate through the web of paperwork and regulations.

Accepted Answer

A) True 
 B)False

Question 7

A typical international trade transaction involves ____________ steps,with the first step being ____________.

Accepted Answer

A)  12; an importer placing an order with an exporter asking if the importer would be willing to ship under a letter of credit 
B)  12; an importer placing an order with an exporter asking if the exporter would be willing to ship under a letter of credit 
C)  14; an exporter placing an order with an importer asking if the exporter would be willing to ship under a letter of credit 
D)  14; an exporter placing an order with an importer asking if the importer would be willing to ship under a letter of credit 
E)  14; an importer placing an order with an exporter asking if the exporter would be willing to ship under a letter of credit

Question 8

The Business Development Bank of Canada focuses on Canadian exporting businesses and provides financial assistance mainly for export specific purposes as a way to facilitate the exchange of goods between Canada and other countries.

Accepted Answer

A) True 
 B)False

Question 9

You have just been hired by a new company,which manufactures frozen foods,to manage their export business to Venezuela,Brazil and Chile.The company management has decided that they are just not ready to organize the documentation and the financial transaction.In fact,because of poor documentation their first shipment was delayed by customs and food inspectors for 90 days before the proper documentation was couriered to the authorities.Your first job is to explain to management how you can improve the preparation of documentation and ensure that the company will get paid for its products.

Accepted Answer

The answer of You have just been hired by a...

Question 10

Exporting is:

Accepted Answer

A)  profitable if little investment is needed 
B)  an end in itself 
C)  a resource drainer for small businesses and therefore should be avoided 
D)  successful when used on a "shot gun" approach 
E)  merely a step on the road toward establishment of foreign production

Question 11

The volume of export activity in the world economy is declining as exporting has become more difficult and regulated.

Accepted Answer

A) True 
 B)False

Question 12

What federal agency supports the development of trade by providing services to exporters,developing policy,and attracting investment to Canada?

Accepted Answer

A)  The UN 
B)  DFAIT 
C)  CITP 
D)  FITT 
E)  EMC

Question 13

What percent of world trade by value in 1998 was in the form of countertrade?

Accepted Answer

A)  less than 5 percent 
B)  approximately 42 percent 
C)  more than 20 percent 
D)  about 33 percent 
E)  about 12 percent

Question 14

According to the text,why is exporting becoming easier?

Accepted Answer

A)  declining trade barriers under GATT 
B)  declining trade barriers under the WTO 
C)  regional economic agreements such as the EU 
D)  regional economic agreements such as NAFTA 
E)  all of these answers are correct

Question 15

The probability of exporting successfully can be increased dramatically by taking eight strategic steps.What are these steps?

Accepted Answer

The answer of The probability of exporting successfully can be...

Question 16

Given the financial and other risks,today,governments at all levels in Canada are not willing to assist small firms in starting export operations.

Accepted Answer

A) True 
 B)False

Question 17

A bill of lading is a:

Accepted Answer

A)  receipt 
B)  contract 
C)  document of title 
D)  transportation agreement 
E)  all of these answers are correct

Question 18

In an international transaction between an Asian exporter and a German importer,the German company will request a ____________ whereas the Asian company will issue a ____________.

Accepted Answer

A)  draft; letter of credit 
B)  bill of lading; letter of credit 
C)  letter of credit; draft 
D)  bill of exchange; bill of lading 
E)  bill of lading; banker's order

Question 19

You are the manager of international markets for Algoma Steel.You have received an offer to purchase 3000 metric tons of wire rods (used to draw wire for the manufacture of nails)from a large nail manufacturer in Panama.What are the most appropriate terms of payment and export conditions given the following information?
Panama's currency has been extremely unstable,with its value depreciating by more than 25% in the last three months.
The legal system is extremely weak in Panama,with many examples of corruption.
Rain and summer heat and humidity can cause the product to deteriorate if stored outside.

Accepted Answer

The answer of You are the manager of international markets...

Question 20

Large firms generally tend to be ______________ about seeking opportunities for profitable exporting,whereas medium-sized and small firms are ____________.

Accepted Answer

A)  passive; aggressive 
B)  reactive; proactive 
C)  discouraged; encouraged 
D)  proactive; reactive 
E)  aggressive; discouraged

Exam 13: Exporting,Importing,and Countertrade

If a firm builds a plant in a country and agrees to take a certain percentage of the plant's output as partial payment for the contract,this is known as an offset.

Mechanisms for financing exports and imports have evolved over the centuries in response to a problem that can be particularly acute in international trade: ________________.

Who are considered to be the masters of countertrade?

Exporters are typically faced with what problems?

The most restrictive countertrade arrangement is:

For novice exporters,it is recommended that they hire an EMC to help identify opportunities and navigate through the web of paperwork and regulations.

A typical international trade transaction involves steps,with the first step being .

The Business Development Bank of Canada focuses on Canadian exporting businesses and provides financial assistance mainly for export specific purposes as a way to facilitate the exchange of goods between Canada and other countries.

Exporting is:

The volume of export activity in the world economy is declining as exporting has become more difficult and regulated.

What federal agency supports the development of trade by providing services to exporters,developing policy,and attracting investment to Canada?

What percent of world trade by value in 1998 was in the form of countertrade?

According to the text,why is exporting becoming easier?

The probability of exporting successfully can be increased dramatically by taking eight strategic steps.What are these steps?

Given the financial and other risks,today,governments at all levels in Canada are not willing to assist small firms in starting export operations.

A bill of lading is a:

In an international transaction between an Asian exporter and a German importer,the German company will request a whereas the Asian company will issue a .

Large firms generally tend to be __ about seeking opportunities for profitable exporting,whereas medium-sized and small firms are .