Which of the following normally takes the form of a wire transfer of money from the bank account of the importer directly to that of the exporter prior to shipment of merchandise?
A)Documentary collection
B)Letter of credit
C)Advance payment
D)Open account

Question

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Advance payment involves the importer directly wiring the money to the exporter's bank account prior to shipment of the merchandise. This is considered the most secure form of payment for the exporter as they have already received payment before shipping the goods. A documentary collection involves the exporter giving shipping documents to their bank to be sent to the importer's bank for payment upon delivery, whereas a letter of credit involves the importer's bank providing a guarantee of payment to the exporter's bank. Open account involves the exporter shipping the goods and invoicing the importer with payment due at a later date.

Which of the Following Normally Takes the Form of a Wire