Which of the following financing methods entails the greatest risk for importers?
A) documentary collection
B) advance payment
C) confirmed letter of credit
D) open account

Question

Quizplus · Accepted Answer

Advance payment entails the greatest risk for importers because the importer pays for the goods before receiving them. If the exporter does not deliver the goods or delivers defective goods, the importer may have difficulty recovering their money.

Which of the Following Financing Methods Entails the Greatest Risk