The total costs for a U.S. company to export to a buyer in a foreign country include the transaction costs of trade financing, import/export duties, and the logistics of delivering to a foreign market penetration which includes distribution, inventory and transportation expenses.

Note, the case does not mention anything about bank commission or fee related to the time draft (even though there usually is one); so proceed as if there is not a bank commission or fee related to the time draft.

1. To export diapers to Material Hospitalar, Crosswell International requires that will Material Hospitalar either pay in full in advance of shipment, or provide a confirmed irrevocable letter of credit from a US bank. Explain the protection that this letter of credit will provide to Crosswell.