For sellers the main benefit of a letter of credit (L/C) is
A) reduced risk because the bank assures the creditworthiness of the buyer.
B) reduced risk because the bank assumes the costs.
C) greater customer loyalty.
D) improved buyer satisfaction.
A
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Suppose you buy an inflation-indexed bond that will adjust with inflation and thus pay you $1,500 in real (inflation-adjusted) terms each year for the next five years, plus your real principal of $75,000 at the end of the fifth year. The nominal interest rate is 5 percent and the expected inflation rate is 2 percent. What is the present value of the bond? (Round off your answer to the nearest thousand dollars and pick the answer closest to the one you calculate.)
A. $65,000 B. $68,000 C. $72,000 D. $75,000
Which of the following is NOT a rationale for tariffs?
a. They improve the terms of trade for small and large nations. b. They protect jobs and reduce unemployment. c. They promote growth and development of young industries. d. They promote a level playing field in terms of trade.
A capital expenditure results in a debit to a(n)
a. expense account. b. capital account. c. asset account. d. liability account.
The first step in the new-product development process is to ________.
A. generate new-product ideas B. conduct business case analysis C. develop the product D. define the market opportunity E. define the product potential