Since most offshore deals require the use of a ___________ the buying firm loses the use of funds when the ________ is established.
A) "secured credit account" / account
B) "letter of credit" / letter
C) "wire transfer" / transfer
D) "letter of recommendation" / letter
E) "credit card" / card

Question

Quizplus · Accepted Answer

Most offshore deals require the use of a "letter of credit" which involves a bank guaranteeing payment to the seller. This means that the buying firm's funds are kept by the bank until the seller receives payment. Therefore, the buying firm loses the use of funds when the "letter of credit" is established.

Since Most Offshore Deals Require the Use of a ___________