Question 1

Novice exporters easily realize the amount of management resources that have to be dedicated to cultivate business in foreign countries.

Accepted Answer

A) True 
 B)False

Question 2

It often makes sense for a firm to enter a foreign market on a large scale to reduce the costs of any subsequent failure.

Accepted Answer

A) True 
 B)False

Question 3

Describe the role of the U.S.Department of Commerce in helping U.S.firms increase their knowledge of export opportunities.

Accepted Answer

Despite institutional disadvantages,U.S....

Question 4

When a time draft is drawn on and accepted by a business firm,it is known as a(n) _____.

Accepted Answer

A)   trade acceptance
B)   in-transit bill
C)   banker's acceptance
D)   bill of lading
E)   letter of creditF) B) and D)
G) B) and E)

Question 5

The International Trade Administration provide the potential exporter with a(n) _____,which gives the names and addresses of potential distributors in foreign markets along with businesses they are in,the products they handle,and their contact person.

Accepted Answer

A)   ELAN list
B)   "best prospects" list
C)   "comparison shopping service"
D)   SCORE list
E)   export management listF) A) and B)
G) C) and D)

Question 6

Which of the following is true of a letter of credit?

Accepted Answer

A)   It states that the bank will pay a specified sum of money to a beneficiary on presentation of particular, specified documents.
B)   It is a document written by an exporter instructing an importer to pay a specified amount of money at a specified time.
C)   It serves as a receipt, a contract, and a document of title.
D)   It indicates that the carrier has received the merchandise described on the face of the document.
E)   It allows buyers to obtain possession of merchandise without signing a formal document acknowledging his or her obligation to pay.F) All of the above
G) C) and D)

Question 7

Which of the following is true of counterpurchase?

Accepted Answer

A)   It is the most restrictive countertrade arrangement.
B)   It is a reciprocal buying agreement.
C)   It is the simplest countertrade arrangement.
D)   It uses a specialized third-party trading house.
E)   It is the direct exchange of goods without a cash transaction.F) A) and B)
G) A) and C)

Question 8

A firm that enters many markets at once runs the risk of spreading its limited management resources too thin.

Accepted Answer

A) True 
 B)False

Question 9

The principle of _____ is to trade goods and services for other goods and services when they cannot be traded for money.

Accepted Answer

A)   a letter of credit
B)   countervailing duty
C)   a bill of exchange
D)   countertrade
E)   the Export Legal Assistance NetworkF) C) and E)
G) None of the above

Question 10

Briefly describe the various financial devices that help exporters solve the problem of a lack of trust in international trade.

Accepted Answer

The financial devices that have evolved ...

Question 11

The lack of a letter of credit exposes the exporter to the risk that the foreign importer will default on payment.The exporter can insure against this possibility by:

Accepted Answer

A)   approaching the World Bank.
B)   buying export credit insurance.
C)   obtaining pre-export financing.
D)   filing a suit against the importer in court.
E)   taking financial aid from Ex-Im Bank.F) B) and C)
G) A) and D)

Question 12

Firms that actively export often lose out on significant opportunities for growth and cost reduction.

Accepted Answer

A) True 
 B)False

Question 13

TruWorth Petroleum negotiated a deal with a foreign country in which TruWorth would build several ammonia plants in the foreign country and receive ammonia as partial payment over a 20-year period.This is an example of _____.

Accepted Answer

A)   switch trading
B)   a buyback
C)   a counterpurchase
D)   an offset
E)   barterF) B) and D)
G) All of the above

Question 14

Export credit insurance protects an exporter against the possibility of a foreign importer's default on payment when there is a lack of a letter of credit.

Accepted Answer

A) True 
 B)False

Question 15

The advantage of export management companies is that they are experienced specialists that can help the neophyte exporter identify opportunities and avoid common pitfalls.

Accepted Answer

A) True 
 B)False

Question 16

In the United States,export credit insurance is provided by _____,an association of private commercial institutions.

Accepted Answer

A)   Export-Import Bank
B)   Bank of New York
C)   Foreign Credit Insurance Association
D)   Federal Deposit Insurance Corporation
E)   Federal Reserve BankF) D) and E)
G) A) and B)

Question 17

Many medium-sized and small 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 overestimate the time and expertise needed to cultivate business in foreign countries.F) C) and D)
G) B) and E)

Question 18

Which of the following is a disadvantage of barter as a countertrade arrangement?

Accepted Answer

A)   It is a very complex arrangement.
B)   In a barter system, if goods are exchanged simultaneously, one party ends up financing the other.
C)   Firms engaged in barter run the risk of having to accept goods they do not want or cannot use.
D)   It involves huge cash transactions.
E)   It cannot be used in transactions with trading partners who are not creditworthy.F) A) and B)
G) A) and C)

Question 19

What is countertrade? When can it be used?

Accepted Answer

Countertrade is an alternative means of ...

Question 20

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

Exam 14: Exporting, Importing, and Countertrade

Export credit insurance protects an exporter against the possibility of a foreign importer's default on payment when there is a lack of a letter of credit.

Correct AnswerverifiedShow Answer

Describe the role of the U.S.Department of Commerce in helping U.S.firms increase their knowledge of export opportunities.

Correct AnswerverifiedDespite institutional disadvantages,U.S....View AnswerShow Answer

Which of the following is true of a letter of credit?

Correct AnswerverifiedShow Answer

When a time draft is drawn on and accepted by a business firm,it is known as a(n) _____.

Correct AnswerverifiedShow Answer

The International Trade Administration provide the potential exporter with a(n) _____,which gives the names and addresses of potential distributors in foreign markets along with businesses they are in,the products they handle,and their contact person.

Correct AnswerverifiedShow Answer

TruWorth Petroleum negotiated a deal with a foreign country in which TruWorth would build several ammonia plants in the foreign country and receive ammonia as partial payment over a 20-year period.This is an example of _____.

Correct AnswerverifiedShow Answer

The principle of _____ is to trade goods and services for other goods and services when they cannot be traded for money.

Correct AnswerverifiedShow Answer

Novice exporters easily realize the amount of management resources that have to be dedicated to cultivate business in foreign countries.

Correct AnswerverifiedShow Answer

A firm that enters many markets at once runs the risk of spreading its limited management resources too thin.

Correct AnswerverifiedShow Answer

Firms that actively export often lose out on significant opportunities for growth and cost reduction.

Correct AnswerverifiedShow Answer

The advantage of export management companies is that they are experienced specialists that can help the neophyte exporter identify opportunities and avoid common pitfalls.

Correct AnswerverifiedShow Answer

In the United States,export credit insurance is provided by _____,an association of private commercial institutions.

Correct AnswerverifiedShow Answer

Which of the following is true of counterpurchase?

Correct AnswerverifiedShow Answer

Many medium-sized and small firms are not proactive in seeking export opportunities because:

Correct AnswerverifiedShow Answer

The lack of a letter of credit exposes the exporter to the risk that the foreign importer will default on payment.The exporter can insure against this possibility by:

Correct AnswerverifiedShow Answer

Briefly describe the various financial devices that help exporters solve the problem of a lack of trust in international trade.

Correct AnswerverifiedThe financial devices that have evolved ...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

What is countertrade? When can it be used?

Correct AnswerverifiedCountertrade is an alternative means of ...View AnswerShow Answer

It often makes sense for a firm to enter a foreign market on a large scale to reduce the costs of any subsequent failure.

Correct AnswerverifiedShow Answer

Which of the following is a disadvantage of barter as a countertrade arrangement?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
Despite institutional disadvantages,U.S....
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The financial devices that have evolved ...
View Answer

Correct Answer
verified

Correct Answer
verified
Countertrade is an alternative means of ...
View Answer

Correct Answer
verified

Correct Answer
verified