INB 3305 Ch. 14

5 types of countertrade:

1) barter 2) counter purchase 3) offset 4) switch trading 5) compensation (buyback

An order written by an exporter introducing an imporer, or an importer's agent, to pay a specified amount of money at a specified time

Bill of exchange

Agency of the US government whose mission is to provide aid in financing and facilitate exports and imports; also referred to as the Ex-Im bank

Export Import bank

Japan's ministry of international trade and industry (always on the lookout for export opportunities)

MITI

Japan's great trading houses (offices all over the world and proactively seek export opportunities for their affiliated companies large and small)

Sogo Shosha

When a time draft is drawn on and accepted by a bank, it is called a :

bankers acceptance

The direct exchange of goods or services between two parties without a cash transaction

barter

Which type of countertrade is viewed as the most restrictive arrangement?

barter

____ __ _____ is the instrument normally used in the international commerce to effect payment

bill of exchange

A document issued to an exporter by a common carrier transporting merchandise; it serves as a receipt, a contract, and a document of title

bill of lading

When a firm builds a plant in a country and agrees to ale a certain percentage of the plants output as partial payment of the contract

buyback

A reciprocal buying agreement

counter purchase

Which type of countertrade is when a firm agrees to purchase a certain amount of materials back from a country to which a sale is made?

counter purchase

The trade of goods and services for other goods and services that cannot be traded for money

countertrade

Countertrade's main attraction is that it can give a firm a way to finance an _____ _____ when other means are not available.

export deal

Export specialists who act as an export marketing department for client firms

export management company

Issued by a bank, indicating that the bank will make payments under specific circumstances

letter of credit

A buying agreement similar to counter purchase, but the exporting country can then fulfill the agreement with any firm in the country to which the sale is being made

offset

3 purposes the Bill of Lading serves as:

receipt, contract, and document of title

A draft payable on presentation to the drawee

sight draft

Two types of drafts:

sight draft; time draft

The use of a specialized third party trading house in a countertrade arrangement

switch trading

Which type of countertrade occurs when a third-party trading house buys the firm's counter purchase credits and sells them to another firm that can better use them?

switch trading

a promise to pay by the accepting party at some future date

time draft

When a time draft is drawn on and accepted by a business firm, it is called a:

trade acceptance