Question 1

SBA's _____ program provides loans for businesses that can generate export sales but do not have the working capital to purchase inventory or to stay in business during the long payment cycles.

Accepted Answer

Export Working Capital

Question 2

Which of the following statements holds true for a nonentity joint venture?

Accepted Answer

A)  In a nonentity joint venture, the partner with the smaller capital investment loses control over the joint venture after a period of two months.
B)  In a nonentity joint venture, each of the partners contributes capital and resources in exchange for an equity stake and share in any resulting profits.
C)  In a nonentity joint venture, the control of the joint venture is in the hands of the party which makes the larger capital investment.
D)  In a nonentity joint venture, there is no contribution of capital to form a new entity.
E)  In a nonentity joint venture the benefit gained is in the form of collective profits rather than individual profits. D

Question 3

The sight draft is payable at a later time, typically 30, 60, 90, or 120 days in the future as specified by the draft.

Accepted Answer

A) True 
 B)False  False

Question 4

What are the constituents of service-level agreements?

Accepted Answer

The answer of What are the constituents of service-level agreements?...

Question 5

What is a letter of credit?

Accepted Answer

The answer of What is a letter of credit?...

Question 6

Which of the following statements holds true for the customs department?

Accepted Answer

A)  It refers to the governmental agency responsible for the transportation of goods from one country to another.
B)  It refers to the governmental agency that establishes special economic zones for organizations willing to invest in the country.
C)  It refers to the governmental agency that provides legal support to foreign institutional investors willing to invest in the country.
D)  It refers to the governmental agency that monitors imports and collects import duties on goods coming into the country.
E)  It refers to the governmental agency that provides financial assistance to multinational companies to set up business establishments in the country.

Question 7

Which of the following statements holds true for cash in advance?

Accepted Answer

A)  It is an arrangement in which the exporter ships the goods and then bills the importer.
B)  It is an arrangement in which an exporter is paid immediately on receipt of the bill of exchange.
C)  It is an arrangement in which an exporter sells a time draft at a discount to an intermediary that will pay the exporter immediately and then collect the full amount from the importer at the later date.
D)  It is an arrangement in which the exporter is paid exactly one year after the delivery has been made to the importer.
E)  It is an arrangement in which the exporter requires payment from the importer before shipping the goods.

Question 8

Which of the following statements holds true for the time draft?

Accepted Answer

A)  The time draft is paid on the receipt of the goods by the importer.
B)  The time draft is payable typically 30, 60, 90, or 120 days in the future as specified by the draft.
C)  The time draft is paid on receipt of the draft (when it is "seen") .
D)  The time draft is paid in advance immediately after the order is made to the exporter and before the export of the ordered goods.
E)  The time draft is paid after a period of exactly one year after the delivery has been made to the importer.

Question 9

A(n) _____ refers to a country that has very advantageous (low) corporate income taxes.

Accepted Answer

The answer of A(n) _____ refers to a country that...

Question 10

What are the two contractual modes of entry into a foreign country?

Accepted Answer

The answer of What are the two contractual modes of...

Question 11

_____ refers to buying goods and services from foreign sources and bringing them back into the home country.

Accepted Answer

A)  Open sourcing
B)  Offshoring
C)  Exporting
D)  Importing
E)  Farmshoring

Question 12

What are the risks of relying only on the export option for entering into a foreign market?

Accepted Answer

The answer of What are the risks of relying only...

Question 13

The _____ is the person or entity sending or transporting the goods out of the country.

Accepted Answer

The answer of The _____ is the person or entity...

Question 14

Under a licensing agreement, the licenser is normally paid a royalty on each unit produced and sold.

Accepted Answer

A) True 
 B)False

Question 15

What are the factors that encourage companies to engage in countertrade?

Accepted Answer

The answer of What are the factors that encourage companies...

Question 16

What is the draft or bill of exchange?

Accepted Answer

The answer of What is the draft or bill of...

Question 17

The document that declares the country from which the product originates is referred to as the _____.

Accepted Answer

The answer of The document that declares the country from...

Question 18

Which of the following statements holds true for an open account?

Accepted Answer

A)  It is an arrangement in which the exporter ships the goods and then bills the importer.
B)  It is an arrangement in which an exporter is paid immediately on receipt of the bill of exchange.
C)  It is an arrangement in which an exporter sells a time draft at a discount to an intermediary that will pay the exporter immediately and then collect the full amount from the importer at the later date.
D)  It is an arrangement in which the exporter is paid exactly one year after the delivery has been made to the importer.
E)  It is an arrangement in which the exporter requires payment from the importer before shipping the goods.

Question 19

Letters of credit are trusted forms of payment in international trade because the bank promises to make the payment on behalf of the importer.

Accepted Answer