If the foreign exchange transaction requires the payment in the exporter's currency, the exporter has the foreign exchange risk.*

True

False

Switch trading is a countertrade practice in which one company sells to another its obligation to make a purchase in a given country.*

True

False

In the case of international trade, the risk of nonpayment is essentially eliminated with the use of a letter of credit through a trustworthy bank. *

True

False

Forfaiting is when importer issues a promissory note to the exporter to pay for its imported capital goods over a period that generally ranges from three to seven years.The exporter then sells the note, without recourse, to a bank *

True

False

With Factoring, the exporter is selling the asset(s). There is nothing to repay. *

True

False

One of the fundamental dilemma for foreign trade is being unwilling to trust a stranger in a foreign land. *

True

False

In Account Receivable Financing, the accounts receivable are sold to a third party (the factor), that then assumes all the responsibilities and exposure associated with collecting from the buyer.*

True

False

In mitigating country risk, it is not an effective strategy to negotiate with the government for concessions or to lower the taxes applied to a foreign company.*

True

False

In consignments, as a payment method in international trade, the importer retains actual title to the goods that are shipped. *

True

False

To avoid debt and to turn short-term loans to long-term loans are examples of strategies to mitigate financial risk. *

True

False

With the use of a Banker's Acceptance, if the exporter does not want to wait for payment, it can request that the B/A be sold in the money market. *

True

False

Global supply chain use financing products to help fund the production of goods, exporting or services and shipment of product using a mixture of pre-export and post export financing. *

True

False

A sight draft is payable on presentation to the drawee; a time draft allows a delay in payment.*

True

False

The form of credit whereby the supplier funds the entire trade cycle is known as supplier debit.*

True

False