Trade MIxed-2

Play an AI-generated podcast conversation about this lesson

What is the primary function of a Trade Services Department in a bank?

To manage supply chain operations

To provide credit to buyers

To offer investment advice

To facilitate trade payment and trade finance (correct)

What is the primary risk associated with cash in advance payment method for the buyer?

Fluctuations in exchange rates

High risk of credit default

Non-delivery of goods (correct)

Non-payment by the seller

Which of the following trade services products is not commonly used in international trade?

Documentary credit (LC)

Bank payment obligation

Investment insurance (correct)

Supply chain financing

What is the primary reason why a seller may request cash in advance?

To avoid credit risk Signup and view all the answers

What is the primary benefit of cash in advance payment method for the seller?

Reduced risk of non-payment Signup and view all the answers

Which of the following trade services products is not a form of trade finance?

Cash in advance Signup and view all the answers

Why may buyers not want to continue importing goods if they are required to make cash in advance payments?

Because they can turn to other suppliers offering better terms Signup and view all the answers

What is the primary difference between cash in advance and open account payment methods?

The timing of payment Signup and view all the answers

What is the primary benefit of a documentary collection over a documentary credit?

Lower costs for the seller Signup and view all the answers

What is required for full security of a documentary collection?

A negotiable bill of lading and consignment to the bank in the importing country Signup and view all the answers

What is the purpose of the ICC Uniform Rules for Collections?

To establish guidelines for collections Signup and view all the answers

What is the primary purpose of a documentary credit or letter of credit?

To balance risks between buyers and sellers Signup and view all the answers

What is the condition for payment in a documentary credit?

Submission of certain documents in a certain form Signup and view all the answers

What is the benefit of the seller stipulating that documents be handed over against the buyer's acceptance of a bill of exchange or signature on a promissory note?

The seller can discount the bill or note for immediate payment Signup and view all the answers

What is the primary advantage of a documentary credit over a documentary collection?

Greater payment security for the seller Signup and view all the answers

What is the role of the bank in a documentary collection?

To manage the document-handling process Signup and view all the answers

What is the scope of the Convention's provisions?

To all contracts of multimodal transport falling within its provisions Signup and view all the answers

What was the role of the UNCTAD's Committee on Shipping in 1986?

It instructed the secretariat to elaborate model provisions for multimodal transport documents Signup and view all the answers

What was the basis for the UNCTAD/ICC Rules for Multimodal Transport Documents?

The Hague/Visby Rules and existing documents such as the FBL Signup and view all the answers

When did the UNCTAD/ICC Rules for Multimodal Transport Documents enter into force?

1 January 1992 Signup and view all the answers

What was the result of the joint UNCTAD/ICC working group's meetings?

The preparation of the UNCTAD/ICC Rules for Multimodal Transport Documents Signup and view all the answers

What is the relationship between the UNCTAD/ICC Rules for Multimodal Transport Documents and the UN Convention on International Transport of Goods?

The UNCTAD/ICC Rules were created pending the entry into force of the UN Convention Signup and view all the answers

What is the primary goal of the URDG 758?

To provide a clearer and more comprehensive set of rules for demand guarantees Signup and view all the answers

What is the purpose of the ISBP 745?

To provide guidance to documentary credit examiners and practitioners Signup and view all the answers

Can the ISBP 745 change the UCP 600 rules for Letters of Credit?

No, the ISBP 745 cannot change the UCP 600 rules Signup and view all the answers

What is the latest and most comprehensive guide to handling and examining trade documents under Letters of Credit?

ISBP 2013 Signup and view all the answers

When was the revised ISBP 2013 published by the ICC?

June/July 2013 Signup and view all the answers

What is notable about the revised ISBP 2013 guide?

It is a substantial update to the former version with new interpretations and new chapters Signup and view all the answers

What is the primary purpose of the standard format for purchase/sale agreement in the banking system?

To protect the interests of clients and mitigate risks Signup and view all the answers

Why is the contract considered less important in the case of LC?

Because the terms and conditions are expected to be in the LC itself Signup and view all the answers

What is the reason for the limited use of standard sales/purchase contract in Bangladesh?

Due to the widespread use of documentary credit Signup and view all the answers

Which of the following countries is NOT a signatory to the UN Vienna Convention?

Bangladesh Signup and view all the answers

What is the primary function of the Bangladesh Bank under the FERA, 1947?

To regulate all kinds of foreign exchange dealings Signup and view all the answers

What is the purpose of the circulars/guidelines issued by the Bangladesh Bank?

To regulate trade payment and financing activities Signup and view all the answers

What is the focus of the FERA, 1947?

To maintain the proper accounting of foreign currency receipts and payments Signup and view all the answers

How many sections are there in the FERA, 1947?

27 Signup and view all the answers