In an international transaction between an Asian exporter and a German importer,the German company will request a ____________ whereas the Asian company will issue a ____________.
A) draft; letter of credit
B) bill of lading; letter of credit
C) letter of credit; draft
D) bill of exchange; bill of lading
E) bill of lading; banker's order

Question

Quizplus · Accepted Answer

In an international transaction, the German importer will request a letter of credit as it provides assurance that the payment will be made upon the completion of the transaction. On the other hand, the Asian exporter will issue a draft as it is a type of financial instrument used to order the buyer's bank to make payment in exchange for goods or services.

In an International Transaction Between an Asian Exporter and a German