Ch.14 Full Test Bank Exporting, Importing, and Countertrade

Global Business Today, 11e (Hill)

Chapter 14 Exporting, Importing, and Countertrade

1) Only large companies have benefited significantly from the moneymaking opportunities of exporting.

2) Most small firms actively seek opportunities for exporting rather than wait for demand from another country.

3) Reactive firms do not consider exporting until their domestic market is saturated.

4) Germany is one of the world's least successful exporting nations because it simply lacks knowledge of opportunities.

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

6) Compared to a decade ago, commercial banks and major accounting firms are more willing to assist small firms in starting export operations.

7) A company would hire a freight forwarder if it wanted to minimize shipping costs and combine many smaller shipments into one large shipment.

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

9) The CORE tool is used by all-sized companies to determine a company's readiness to export a product.

10) Lack of trust in international trade is exacerbated by the distance between the two parties in space, language, and culture.

11) Issued by a bank at the request of an importer, a letter of credit states that the bank will pay a specified sum of money to the exporter, on presentation of particular, specified documents.

12) A bill of lading verifies to the exporter that his or her company is guaranteed payment and, as a result, the exporter will ship the products.

13) A draft instructs the exporter to ship product.

14) In international commerce, a person or business initiating a draft is known as the drafter and the party to whom the draft is presented is known as the draftee.

15) In domestic trade transactions, a buyer can often obtain possession of merchandise without signing a formal document acknowledging his or her obligation to pay.

16) An international business would use a sight draft when it wishes to delay payment.

17) In international commerce, time drafts are non-negotiable instruments.

18) A bill of lading proves that the carrier has received the merchandise described on the document.

19) The Export-Import Bank provides financing aid to prospective U.S. exporters.

20) The mission of the Foreign Credit Insurance Association is to provide financing aid that will facilitate exports, imports, and the exchange of commodities between the United States and other countries.

21) Without a letter of credit, an exporter faces the risk that the foreign importer will not make payment.

22) A countertrade indicates the exchange of money for goods and services.

23) Barter is primarily used with trading partners who are not creditworthy or trustworthy.

24) An offset agreement limits the flexibility to choose the goods an exporter wants to purchase.

25) Countertrade's main attraction is that it can give a firm a way to finance an export deal when other means are not available.

26) Exporting is nearly always a way to increase the revenue and profit base of a company because

A) there is little competition in the international market.

B) foreign governments encourage imports from other countries.

C) international markets are less complex than their domestic counterparts.

D) the international market is much larger than the domestic market.

E) it does not involve wasting resources on paperwork.

27) Jeff, the sales manager for Audio-Visual Systems, a small family business, is eager to get the company on an export path. The CEO of the company is not convinced, however. To convince the CEO, Jeff should point out that firms that do not export often

A) face problems of currency conversion.

B) lose out on significant opportunities for cost reduction.

C) are able to reduce their unit costs.

D) typically grow faster than those that do.

E) can more easily leverage their technology in foreign markets.

28) When seeking opportunities for profitable exporting, large firms generally tend to be

A) passive.

B) risk averse.

C) wary.

D) proactive.

E) neutral.

29) In terms of exporting, what can be said of medium-sized and small firms?

A) They are proactive about seeking opportunities for profitable exporting.

B) They consider exporting only after their domestic market is saturated.

C) They are not intimidated by the complexities of foreign legal systems.

D) They have a high degree of familiarity with foreign market opportunities.

E) They explore foreign markets to find opportunities for leveraging their technology.

30) Many medium-size firms are not proactive in seeking export opportunities because

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 can't recruit managers with the expertise needed to cultivate business in foreign countries.

31) A common pitfall that novice exporters come across involves

A) poor understanding of the domestic market.

B) low unit costs.

C) increased economies of scale.

D) problems securing financing.

E) familiar distribution systems.

32) One characteristic of exporting that many first-time exporters do not realize is that

A) many foreign customers require face-to-face negotiations on their home turf.

B) large firms tend to wait for the world to come to them, rather than going out into the world to seek opportunities.

C) exporters have the advantage of reduced paperwork and fewer formalities.

D) medium-size and small firms are proactive about seeking opportunities for profitable exporting.

E) firms that focus only on exporting often lose out on significant opportunities for growth and cost reduction.

33) Unhappy with the speed with which the company's export initiative was going, the CEO called Ken, the person in charge of exports at Resolve Products. What aspect of exporting can Ken use to validate the slow progress of Resolve Products' efforts?

A) The U.S. government does not provide any help for exporters.

B) Novice exporters tend to overestimate the time required to cultivate business in foreign countries.

C) Exporters often face voluminous paperwork, complex formalities, and many potential delays and errors.

D) Small firms are usually familiar with foreign market opportunities.

E) Large firms do not consider exporting until their domestic market is saturated.

34) Sogo shosha in Japan are a type of

A) freight forwarder.

B) trading house.

C) currency exchange.

D) production site.

E) customer service center.

35) The function of sogo shosha in Japan is to

A) proactively and continuously seek export opportunities for their affiliated companies.

B) exclusively serve the largest and most prestigious companies in Japan.

C) have offices concentrated in the business district of Tokyo.

D) monopolize the export market in the country.

E) consider export only when there is excess production at home.

36) What is an accurate assessment when comparing exports of Germany, Japan, and the United States?

A) Historically, only the United States has made its living as a trading nation.

B) Germany and Japan are relatively self-contained continental economies in which international trade played a minor role.

C) Unlike Japan or Germany, U.S. firms have a strong information advantage when they seek export opportunities.

D) The United States has not yet evolved an institutional structure for promoting exports similar to that of Germany or Japan.

E) The Ministry of International Trade and Industry (MITI) in the United States is always on the lookout for export opportunities. There is no such organization elsewhere.

37) Kristine works for Ringer Labs in Salt Lake City, Utah. Her company is seeking information on export opportunities. What is the best source of information Kristine can use?

A) Small Business Administration

B) Department of Commerce

C) Federal Trade Commission

D) United Nations

E) Federal Deposit Insurance Corporation

38) Which institution within the U.S. Department of Commerce is dedicated to providing businesses with intelligence and assistance for attacking foreign markets?

A) International Trade Administration

B) Small Business Administration

C) Federal Trade Commission

D) Bureau of Competition

E) Bank of New York

39) One way the U.S. Department of Commerce helps potential exporters is by

A) overseeing volunteers with international trade experience.

B) assembling a "comparison shopping service" for countries that are major markets for U.S. exports.

C) coordinating a nationwide group of international trade attorneys who provide free initial consultations to small businesses.

D) providing export specialists who act as the export marketing departments for their client firms.

E) starting exporting operations for firms until they are well established.

40) Manuel, the CEO of Gilson Products, a small manufacturer of office furniture, is going abroad along with representatives of the U.S. Department of Commerce and other U.S. businesspeople to meet with qualified agents, distributors, and customers. Manuel is most likely participating in the

A) matchmaker program.

B) "best prospects" listing.

C) SCORE program.

D) "comparison shopping service."

E) export-import program.

41) The government organization that employs 76 district international trade officers and 10 regional international trade officers throughout the United States as well as a 10-person international trade staff in Washington, D.C., to help to help potential exporters is the

A) Federal Trade Commission.

B) U.S. Commercial Service.

C) International Trade Administration.

D) Small Business Administration.

E) sogo shosha.

42) The Small Business Administration oversees almost 11,500 volunteers with international trade experience to provide one-on-one counseling to active and new-to-export businesses through its program known as the

A) Export Legal Assistance Network.

B) Service Corps of Retired Executives.

C) International Trade Veteran's Group.

D) Network of Foreign Trade Executives.

E) Export Management Company.

43) The Small Business Administration coordinates a group of ________ in the ELAN program who provide free initial consultations to small businesses on export matters.

A) engineers

B) politicians

C) accountants

D) attorneys

E) networkers

44) The Eks-Plore Company exports outdoor gear for firms on the east coast of the United States. The company identifies companies in Europe and Asia that market and sell these products. Eks-Plore handles all documentation, logistics, and transportation for the products. What type of business is the Eks-Plore Company?

A) export trading company

B) wholly owned subsidiary

C) franchise

D) confirming house

E) piggyback marketers

45) A medium-size skincare company based in Minnesota plans to expand operations into four countries in Europe. The company decides to hire a(n) ________ that can help the company with the specific laws and documentation requirements for imports for the four countries.

A) confirming house

B) customs broker

C) export packaging company

D) franchisee

E) buying agent

46) Deli-Lite has a contract with a foreign client to provide low-fat deli trays. Deli-Lite does not have one of the items the foreign client wants on the trays, so it decides to contract with Green Source to fulfill this contract. What is this an example of?

A) piggyback marketing

B) an acquisition

C) a customs broker

D) licensing

E) a remarketer

47) Miami WindSails wants to export but, as a small family business, is cautious, particularly with respect to financial risk. What is a strategic step that you would advise Miami WindSails to take to increase its probability of exporting successfully?

A) avoid the use of export management companies to contain costs

B) enter several markets simultaneously to hedge risk

C) enter a foreign market on a small scale

D) wait for export opportunities to come to them

E) avoid recruitment of local personnel

48) Firms engaged in international trade deal with people they may have never seen, who live in different countries, who speak different languages, and who abide by different legal systems. These factors result in

A) easy tracking of the parties involved.

B) a lack of trust between the parties.

C) strict enforcement of contractual obligations.

D) rapid acculturation.

E) better understanding of how transactions should be configured.

49) Savannah Pecans is a fourth-generation family business. The company has concentrated on the U.S. market by selling its products primarily in the United States but now wants to sell abroad. The board of directors is hesitant about new markets because of their lack of knowledge regarding foreign legal systems and languages. What is the likely reason behind this hesitation?

A) poor education

B) a lack of trust

C) tariff barriers

D) rapid

E) licensing arrangements

50) As an exporter, Horizon Trading wants to be paid before a consignment is shipped. Correspondingly, its importer in Italy, Friggo Imports, wants to pay only upon receipt of the consignment. These conflicting preferences of Horizon Trading and Friggo Imports are most likely a manifestation of

A) corporate greed.

B) acculturation.

C) lack of trust.

D) cultural insensitivity.

E) countertrading opportunities.

51) A lack of trust between two parties engaged in international trade can be exacerbated by the

A) saturation of the domestic market.

B) similar preferences of the parties regarding how a transaction should be configured.

C) narrowing distance between the two parties due to technological advances.

D) problems of using an underdeveloped international legal system to enforce contractual obligations.

E) possibility of doing business with someone with whom they have been associated for a long time.

52) In terms of using a third party in international trade, title to the products is given to a bank by the exporter in the form of a document known as a

A) merchandise bill.

B) bill of lading.

C) bill of exchange.

D) draft.

E) letter of credit.

53) Neptune Corp. is exporting for the first time to Australia and has contracted with Pinkerton Imports in Melbourne for an initial order valued at $110,000. Neptune Corp. wants Pinkerton Imports to secure a document from a Melbourne bank that indicates the bank will pay Neptune Corp. $110,000 upon presentation of specified documents by the exporter. What document is Neptune Corp. asking for?

A) bill of lading

B) time draft

C) letter of credit

D) sight draft

E) bill of exchange

54) What is the purpose of a letter of credit?

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.

55) What is an advantage of having a letter of credit?

A) It allows payment for merchandise after its delivery.

B) It facilitates an exporter to obtain pre-export financing.

C) It allows an exporter to get a higher price for his or her goods.

D) It helps exporters incur lower shipping costs.

E) It does not require the importer to pay any fee.

56) Peterson Manufacturing wants to import a machine from Germany. However, the company's head of manufacturing is reluctant to spend the time required to obtain a letter of credit that the German exporter insists on. You are the company's CFO. What advantage of a letter of credit will help convince the head of manufacturing that this is worthwhile?

A) The importer does not have to pay for the merchandise until the documents have arrived.

B) Obtaining pre-export financing becomes easier.

C) It helps the importer to get goods for a lower price.

D) It results in lower shipping costs.

E) The importer does not have to pay the third party a fee for facilitating the transaction.

57) For an importer, what is a disadvantage of using a letter of credit for international transactions?

A) It results in the importer losing control over the process of trading.

B) It reduces the exporter's level of trust in the importer.

C) It reduces the importer's ability to borrow funds for other purposes.

D) It requires the importer to repay the loan even before the merchandise is sold.

E) It is not issued at the importer's request.

58) Tuf-Enuf Steel, a rapidly growing company, is looking to buy a large industrial furnace from Thailand that is expected to cost $3 million. The exporter wants Tuf-Enuf Steel to produce a letter of credit, but its CFO is reluctant to do so. What disadvantage of letter of credits is the likely reason for the CFO's reluctance?

A) It results in the importer losing control over the process of trading.

B) It reduces the exporter's level of trust in the importer.

C) It reduces the importer's ability to borrow funds for other purposes.

D) It requires the importer to repay the loan even before the merchandise is sold.

E) It is not issued at the importer's request

59) Mulch-Rite Inc., based in Germany, has contracted with a company in Italy to export twenty tons of mulch. Mulch-Rite has written an order requesting that the Italian company pay €15,000 by June 15 prior to the shipping date. This order is an example of a

A) bill of lading.

B) draft.

C) letter of credit.

D) counterpurchase.

E) buyback.

60) How do international and domestic practices of settling trade transactions differ?

A) In an international transaction, a formal promise to pay is required before the buyer can obtain the merchandise.

B) In an international transaction, the seller usually ships merchandise on an open account.

C) In a domestic transaction, a draft is used to settle trade transactions.

D) In an international transaction, the exporter sends a commercial invoice that specifies the amount due and terms of payment to the importer.

E) In an international transaction, there is more trust between the exporter and the importer than in a domestic transaction.

61) Jamal Steel, a rapidly growing small steel company with annual revenues of $8 million, is looking to buy a large industrial furnace from Shinto Manufacturing, a Japan-based company. Rather than have a letter of credit binding the two parties, both agree on a draft. In international commerce, Shinto Manufacturing, the party initiating the draft, is known as the

A) maker.

B) drawee.

C) buyer

D) agent.

E) drafter.

62) Manatee Products, a U.S. company, is exporting to a Japanese company. The two parties agree on a draft, but Manatee Products wants it to be a draft that is payable on presentation to the Japanese company. Manatee Products is asking for a(n)

A) bill of lading.

B) sight draft.

C) letter of credit.

D) time draft.

E) offset.

63) When Carlton Company Inc. exported elevator component parts to a company in Taiwan, it allowed the company 90 days to pay for the parts. This is an example of a(n)

A) sight draft.

B) time draft.

C) bill of lading.

D) counterpurchase.

E) offset.

64) When a time draft is presented to a drawee, the company signifies acceptance of it by

A) delivering the goods immediately.

B) paying the draft amount immediately.

C) providing a collateral for the amount specified in the bill.

D) writing or stamping a notice of acceptance on its face.

E) selling the draft to an investor at a discount from its face value.

65) Once accepted by the drawee, a time draft becomes a(n)

A) asset for the drawee.

B) in-transit bill.

C) promise to pay by the accepting party.

D) bill of lading.

E) letter of credit held by the bank.

66) When a time draft is drawn on and accepted by a bank, it is known as a

A) trade acceptance.

B) banker's check.

C) banker's acceptance.

D) bill of lading.

E) letter of credit.

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

A) trade acceptance.

B) in-transit bill.

C) banker's acceptance.

D) bill of lading.

E) letter of credit.

68) A time draft is a negotiable instrument, which means that it

A) has no value given the deferred nature of the document.

B) is generally not preferred in international transactions.

C) can be sold to an investor.

D) is also known as a bill of lading.

E) cannot be transferred.

69) A ________ is issued to an exporter by a common carrier transporting the merchandise and serves as a receipt, a contract, and a document of title.

A) bill of lading

B) collateral title

C) draft

D) letter of credit

E) bill of exchange

70) When a bill of lading specifies that the carrier is obligated to provide a transportation service in return for a certain charge, it is acting as a

A) contract.

B) receipt.

C) document of title.

D) letter of credit.

E) bill of exchange.

71) Pro-Racquets has a bill of lading for an order of 10,000 tennis rackets it will be exporting to a foreign distributor. The company takes this bill of lading to the local bank and uses it to obtain funds to hold the company over until final payment is received from the foreign distributor. In this situation, the bill of lading is being used as

A) collateral.

B) licensing.

C) a draft.

D) a contract.

E) a receipt.

72) When a bill of lading is used to obtain payment or a written promise of payment before the merchandise is released to the importer, it serves as a

A) document of title.

B) contract.

C) receipt.

D) time draft.

E) collateral.

73) What is the first step in a typical international trade transaction?

A) The exporter agrees to ship under a letter of credit and specifies relevant information such as prices and delivery terms.

B) The importer applies to a trusted third party (usually a bank) for a letter of credit to be issued in favor of the exporter for the merchandise the importer wishes to buy.

C) The importer places an order with the exporter and asks the exporter if he would be willing to ship under a letter of credit.

D) The exporter ships the goods to the importer on a common carrier. An official of the carrier gives the exporter a bill of lading.

E) The trusted third party (usually a bank) issues a letter of credit in the importer's favor and sends it to the exporter's bank.

74) Financing aid that will facilitate exports, imports, and the exchange of commodities between the United States and other countries is provided by the

A) International Monetary Fund.

B) World Bank.

C) Overseas Commercial Service.

D) Ex-Im Bank.

E) Export Credit Insurance Association.

75) Repayment of medium- and long-term loans that U.S. commercial banks make to foreign borrowers for purchasing U.S. exports is guaranteed by the

A) Federal Deposit Insurance Corporation.

B) Central Bank.

C) World Bank.

D) Ex-Im Bank.

E) Export Credit Insurance Association.

76) An exporter might have to forgo a letter of credit when

A) competing exporters also require letters of credit.

B) the importer is facing stiff competition from other importers.

C) the exporter is a dominant player in a noncompetitive market.

D) the importer is in a strong bargaining position.

E) he or she knows that the importer will default on payment.

77) A U.S. company would invest in export credit insurance when it

A) is exposed to the risk that an importer may default on payment.

B) is dealing in a country that has a nonconvertible currency.

C) is unable to obtain any pre-export financing.

D) has received a letter of credit from the importer's bank.

E) has to enter a barter-like agreement.

78) In the United States, export credit insurance is provided by the

A) Export-Import Bank.

B) Bank of New York.

C) Foreign Credit Insurance Association.

D) Federal Deposit Insurance Corporation.

E) Federal Reserve Bank.

79) The Foreign Credit Insurance Association (FCIA) is an association of private commercial institutions operating under the guidance of the

A) Federal Mediation and Conciliation Service.

B) U.S. Department of Commerce.

C) Export-Import Bank.

D) International Trade Administration.

E) Ministry of International Trade and Industry.

80) Countertrade is a form of

A) licensing.

B) dumping.

C) bartering.

D) brokering.

E) franchising

81) A range of barterlike agreements by which goods and services are traded for other goods and services when they cannot be traded for money is known as

A) countertrade.

B) carry trade.

C) free trade.

D) counter sale.

E) countervailing duty.

82) Saudi Arabia agreed to purchase 5,000 air conditioning systems from Air-Cool Corp. with payment in the form of crude oil that is discounted 22 percent below posted world oil prices. This transaction is a form of

A) countertrade.

B) acquisition.

C) licensing.

D) greenfield venture.

E) piggyback marketing.

83) Countertrade arose in the 1960s as a way to purchase imports for ________, whose currency was nonconvertible.

A) the United States

B) the Soviet Union

C) Germany

D) Japan

E) African countries

84) What is a characteristic of countertrade?

A) The governments of developing nations sometimes insist on a certain amount of countertrade.

B) Countertrade is a means of structuring an international sale when conventional means of payment are cost-effective.

C) Nonconvertibility is an advantage for exporters.

D) Nonconvertibility implies that the exporter will be paid only in his or her home currency.

E) Most exporters desire payment in a currency that is not convertible.

85) Rather than use cash, Indonesia traded textiles with the United States in exchange for corn. This is an example of which form of countertrade?

A) switch trading

B) counterpurchase

C) buyback

D) barter

E) offset

86) The direct exchange of goods and/or services between two parties without a cash transaction is referred to as

A) switch trading.

B) counterpurchase.

C) barter.

D) offset.

E) buyback.

87) The most restrictive countertrade arrangement is

A) counterpurchase.

B) offset.

C) barter.

D) switch trading.

E) buyback.

88) What is a disadvantage of barter as a countertrade arrangement?

A) It is a very complex arrangement.

B) 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.

89) To cater to the growing demand for luxury automobiles, Italy agrees to buy 5,000 cars from Comfort Cars Inc. in exchange for 5,000 barrels of oil. Since Comfort Cars Inc. is not seen as creditworthy, Italy decides to make this a one-time-only deal. What form of countertrade is Italy using?

A) counterpurchase

B) offset

C) switch trading

D) barter

E) buyback

90) The type of countertrade where a firm agrees to purchase a certain amount of materials back from a country to which a sale is made is called

A) barter.

B) counterpurchase.

C) compensation.

D) switch trading.

E) buyback.

91) A firm sells some products to a foreign country. The foreign country pays the firm in dollars but in exchange the firm agrees to spend some of the proceeds from the sale on textiles produced by the foreign country. What type of countertrade arrangement are the two parties engaged in?

A) switch trading

B) buyback

C) counterpurchase

D) barter

E) compensation

92) A buying agreement where the exporting country can fulfill the agreement with any firm in the country to which the sale is being made is called a(n)

A) switch trade.

B) offset.

C) buyback.

D) arbitrage.

E) barter.

93) From an exporter's perspective, why is an offset more attractive than a straight counterpurchase agreement?

A) It is the simplest countertrade arrangement.

B) It gives the exporter greater flexibility to choose the goods that it wishes to purchase.

C) It allows the use of a specialized third-party trading house.

D) It gives the exporter counterpurchase credits, which can be used in another country.

E) It allows direct exchange of goods and/or services between two parties without a cash transaction.

94) A type of countertrade where a third-party trading house buys the firm's counterpurchase credits and sells them to another firm that can better use them is called

A) barter.

B) switch trading.

C) offset.

D) buyback.

E) compensation.

95) Full-Sole Shoes concludes a counterpurchase agreement with Japan for which it receives some counterpurchase credits. Full-Sole Shoes does not want any foreign goods, however, so it sells the credits to a third-party trading house at a discount. The trading house finds a firm that can use the credits and sells them at a profit. This is an example of

A) barter.

B) switch trading.

C) an offset.

D) a buyback.

E) compensation.

96) Energy Source International builds a plant in Switzerland and agrees to take a certain percentage of the plant's output as partial payment for the contract. This type of countertrade is called a(n)

A) counterpurchase.

B) offset.

C) switch trade.

D) buyback.

E) barter.

97) Consolidated Petroleum negotiated a deal with Saudi Arabia in which Consolidated Petroleum would build several refineries in Saudi Arabia and receive oil as partial payment over a 20-year period. This is an example of

A) switch trading.

B) a buyback.

C) a counterpurchase.

D) an offset.

E) barter.

98) A drawback of countertrade is that

A) it fails to enable firms to finance an export deal.

B) it is detrimental to the economy of the importing country.

C) developing nations have trouble raising the foreign exchange necessary to pay for imports.

D) it does not allow firms to invest in an in-house trading department dedicated to arranging and managing deals.

E) it may involve the exchange of poor-quality goods that cannot be disposed of profitably.

99) One drawback of a countertrade agreement is that

A) it fails to give firms a way to finance an export deal.

B) it requires an in-house trading department to be maintained, which can be expensive and time-consuming.

C) it is detrimental to the economy of the importing country.

D) developing nations may have trouble raising the foreign exchange necessary to pay for imports.

E) it is not an acceptable means of trading in most developing countries.

100) Countertrade is most attractive for

A) small exporters.

B) large multinational enterprises.

C) only U.S.-based firms.

D) any firm in democratic nations.

E) new companies.

101) Describe some of the common pitfalls encountered by companies trying to do business abroad for the first time.

102) Compare and contrast the experience of exporting for U.S. firms with that of German and Japanese firms.

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

104) How does the Small Business Administration (SBA) help potential exporters?

105) Describe the role of export management companies. List their advantages and disadvantages.

106) Compare and contrast a customs broker with a confirming house.

107) How does a lack of trust affect firms engaged in international trade? How can the problem be solved?

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

109) Explain the difference between a sight draft and a time draft.

110) Briefly describe the different forms of government-backed assistance that help potential U.S. exporters finance their export programs.

111) Describe the mission of the Ex-Im Bank.

112) Explain why a company would use export credit insurance.

113) What is countertrade? When can it be used?

114) Briefly describe the different types of countertrade arrangements.

115) Describe the types of companies that benefit most from countertrade.