Introduction to Finance

 14. 
(LO 6.6)
Describe the various ways by which an exporter may 
fi nance an international shipment of goods. How may commercial 
banks assist the exporter in collecting drafts?
 15. 
(LO 6.6)
How do importers protect themselves against improper 
delivery of goods when they are required to make payment as they 
place an order?
 16. 
(LO 6.6)
Describe the process by which an importing fi rm may 
substitute the credit of its bank for its own credit in fi nancing interna-
tional transactions.
 17. 
(LO 6.6)
How may a bank protect itself after having issued a 
commercial letter of credit on behalf of a customer?
 18. 
(LO 6.6)
Describe the costs involved in connection with fi nan-
cing exports through banker’s acceptances.
 19. 
(LO 6.6)
Describe the ultimate sources of funds for export fi n-
ancing with banker’s acceptances. How are acceptances acquired for 
investment by these sources?
 20. 
(LO 6.6)
Explain the role played in international trade by the 
Export-Import Bank. Do you consider this bank to be in competition 
with private lending institutions?
 21. 
(LO 6.6)
Commercial letters of credit, traveler’s letters of credit, 
and traveler’s checks all play an important role in international 
fi nance. Distinguish among these three types of instruments.
 22. 
(LO 6.7)
Briefl y indicate the problems facing the United States 
in its attempt to maintain international fi nancial equilibrium.
 23. 
(LO 6.7)
The current account is an important component of the 
U.S. balance of payments. Describe the current account and indicate 
its major components. 
 24.