In an international transaction involving a bank as a third party, the exporter ships the product after
A) the bank receives materials from the importer.
B) receiving a cleared payment through the bank.
C) the importer has paid the bank.
D) the bank promises to pay on the importer's behalf.

Question

Quizplus · Accepted Answer

When trading with a bank as a third-party, the importer obtains the bank's promise to pay on the importer's behalf at first. Then, the bank promises the exporter to pay on behalf of the importer. The exporter ships the items after this.

In an International Transaction Involving a Bank as a Third