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1. 101. CURRENCY OF THE TRANSACTION is that a

a. International contracts for the sale of goods or ser-
vices need to specify in what currency the payment
is to be made
b. The buyer and the seller may be separated by huge
distances requiring several modes of transport
c. The most fundamental concern of the seller is cer-
tainty of getting paid for the goods sold
d. The seller wants to make certain that goods
shipped equals goods received
2. 102.The cost and particulars of ________ will be of b

concern to the seller, especially when the terms of the
contract specify that the seller is responsible for this
costs to the buyer's door or to thr port of entry of the
buyer's country
a. Purchasing
b. Transportation
c. Brokering
d. Buying
3. 103. Payment by ________ requires that the buy- d

er pay the seller prior to shipment of the goods
ordered._____________provides the seller with the
most security but leaves the buyer at great risk that
the seller will not comply with all the terms of the
contract.
a. Cash in advance, Open Account
b. Cash in advance, Letter of Credit
c. Documentary Collections, Cash in advance
d. Cash in advance, Cash in advance
4. 104. _________________________is a bank's b

promise to pay a seller on behalf of the buyer so long
as the seller complies with precisely defined terms
and conditions specified in the credit.
a. Open account
b. A documentary letter of credit
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c. Cash in advance
d. Documentary Collections
5. 105. When___________is issued by the buyer's bank b

assumes the payment responsibility for the buyer,
thereby placing the credit standing of the bank be-
tween the seller and the buyer.
a. an open account
b. a letter of credit
c. a cash in advance
d. a documentary of payment
6. 106. The ______________ bank is instructed not to d

transfer the documents to the buyer until payment
is made (documents against payment, D/P) or upon
guarantee that payment will be made within a spec-
ified period of time (documents against acceptance,
D/A).
a. seller's
b. producer's
c. broker's
d. buyer's
7. 107. A__________________________________is sim- a

ilar to an international cash on delivery (COD). The
seller ships goods to the buyer but sends the doc-
uments, including the bill of lading (title document),
through the banks with instructions to release them
to the buyer only upon payment.
a. documentary collection
b. letter of credit
c. Cash in advance
d. Open account
8. 108. ______________________ payments are made b

either by bank draft or check or through a wire
payment to the bank account specified by the sell-
er/exporter. If receiving payment by check, the seller
should verify that it has been cleared by the buyer's
bank before preoceeding with shipment
2 / 81
a. Open account
b. Cash in advance
c. Documentary collection
d. Letter of credit
9. 109. In a documentary credit, the ____________spec- b

ifies the documentation required from the _________
before the_____________ is to make payment, and
the seller is given assurance that payment will be
made after shipping the goods so long as the docu-
mentation is in order.
a. seller, buyer, bank
b. Buyer, seller, bank
c. bank, seller, buyer
d. Buyer, bank, seller
10. 110. Purchase on____________________means that a

the buyer agrees to pay for goods ordered within a
designated time after their shipment. Common terms
are 30,60 or 90 days although longer terms of 180
days are not unheard of
a. Open account
b. Cash in advance
c. Letter of Credit
d. Documentary collection
11. 111. In a sales contract between a seller and a buy- a

er, open account payments are made either by bank
draft or check or through a wire payment to the bank
account specified by the___________________
a. Exporter
b. Importer
c. Freight forward
d. Customs broker
12. 112. There are many ways of dealing b

with_______________________risk and the simplest,
if you are the seller, is insisting on payment in your
own currency.
a. Delivery
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b. Foreign exchange
c. Production
d. Insurance
13. 113. A trader can reserve a future foreign currency a

payment or receivable by borrowing domestic curren-
cy now, converting the currency into foreign currency
at today's exchange rate, and investing te proceeds
in foreign money market instruments. What is this?
a. Money Market Hedge
b. Upward Market Hedge
c. Forward Market Hedge
d. Competitive Market
14. 114. In documentary credit, upon receiving a

the documents from thr opening bank in
the____________________country, the buyer is re-
quired to supply domestic currency equal to
the amount of foreign currency paid by the
__________________________ bank.
a. buyer's, overseas
b. buyer's, domestic
c. seller's, overseas
d. buyer's, buyer's
15. 115. If the conversation of currency occurs on the d

same day as payment is made, it is usually based
on the exchange rates of the two currencies on
that day. The buyer's bank just sells the foreign
exchange to the buyer at that day's rate (called
the___________________) and credits the foreign ex-
change account of the overseas bank.
a. immediate rate
b. future rate
c. forward rate
d. spot rate
16. 116. If a seller receives a letter of credit in a foreign c

currency the seller may arrange with the local advis-
ing bank to sell the foreign currency to be relized
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upon payment. This case is:
a. Hedging Risks for buyers
b. Costs of Hedging
c. Hedging hints for sellers
d. Risks of Hedging
17. 117. A____________________________in internation- a

al business is not merely a document setting forth
quantity, price, and delivery schedule of the products
(although it must surely include such information); it
must also take into consideration the local legal sys-
tem and political and currency risks in the countries
involved.
a. Contract
b. Exchange
c. Co-operation
d. Business
18. 118. Many organizations around the world provide b

arbitration services. Each arbitrition association has
its own rules of practice and procedure, but most
are______________________.
a. Different
b. Similar
c. Variable
d. Same
19. 119. Incoterms don't show which aspect as below c

a. Rules
b. Regulations
c. Banks
d. Agreements
20. 120. In Incoterms 2010, this term means that the seller c
delivers when the goods pass the ship's rail at the
named port of shipment. This means the buyer has to
bear all costs and risks to the goods from that point.
The seller must clear the goods for export. What is
this term?
a. EXWORKS
5 / 81
b. FCA
c. FOB
d. CIF
21. 121. A United States exporter is delivering goods a

from New York Airport for air shipment to Paris Air-
port. The air freight is to be arranged and paid by the
importer. The correct Incoterms rule in such circum-
stances would be
a. FCA New York Airport, Incoterms 2010
b. DDP PAris Airport, Incoterms 2010
c. FOB New York Airport, Incoterms 2010
d. CPT PAris Airport, Incoterms 2010
22. 122. ________________________acceptances often d

represent the easiest, least expensive way for a seller
to provide credit to a buyer, while enjoying the secu-
rity provided by the documentary transaction.
a. buyer and seller'
b. buyer and bankers'
c. seller and bankers'
d. trade and bankers'
23. 123. BAnkers acceptances are generally short-term, a

that is up to_____________
a. 180 days
b. 90 days
c. 60 days
d. 30 days
24. 124. In documentary collections, banks b

are______________________with buying and selling
of goods. They are concerned with remitting (send-
ing) documents from the principal (seller) and pre-
senting drafts (orders to pay) to the drawee (buyer)
for payment.
a. Concerned
b. Not concerned
c. Getting
d. Close
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25. 125. Which party prepares documentation (collection a

documents) and submits (remits) them to his bank
(remitting bank) with a collection order for payment
from the buyer (drawee)?
a. The Principal (Seller/Exporter/Drawer)
b. The Remitting (PRincipal's/Seller's/Exporter's)
Bank
c. The Collecting or Presenting (Buyer's) Bank
d. The Drawee (Buyer/Importer)
26. 126. _______________________________receives b

documentation (collection documents) from the sell-
er (principal) for forwarding (remitting) to the buyer's
bank (collecting /presenting bank) along with instruc-
tions for payment.
Bank
27. 127. _____________________is the party that makes d

cash payment or signs a draft according to the terms
of the collection order in exchange for the documents
from the presenting/collecting bank and takes pos-
session of the goods._____________________is the
one on whom a draft is drawn and who owes the
indicated amount.
Bank
28. 128. Basic Documentary Collection Procedure in- d

clude
a. specifying a documentary collection as the means
of payment
b. naming a collecting/presenting bank (usually the
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buyer's bank)
c. listing required documents
d. All of these
29. 129. The__________________bank sends the doc- c

umentation package by mail or by courier
to the designated colleting/presenting bank in
the__________________country with instructions to
present them to ____________________and collect
payment
a. Remitting, seller's, the drawee (buyer)
b. Remitting, buyer's, the drawer (buyer)
c. Remitting, buyer's, the drawee (buyer)
d. Remitting, seller's, the drawer (seller)
30. 130. The presenting (collecting) bank in a documen- d

tary collection is NOT responsible for
a. reviewing the documents making certain they are
in conformity with the collection order
b. notifying the buyer (drawee) about the terms and
conditions of the collection order
c. releasing the documents once the payment condi-
tions have been met
d. paying the seller (drawer) as long as the presented
documents are complied with the sales contranct
31. 131. The____________________________bank may a

find it necessary or desirable to use an intermedi-
ary bank (called a correspondents bank) rather than
sending the collection order and documents directly
to the ____________________ bank.
a. Remitting, collecting
b. Collecting, Remitting
c. Seller, buyer
d. Buyer, Seller
32. 132. Which method of payment is that the collecting a

bank release the documents to the buyer only upon
full immediate cash payment and most closely resem-
ble a traditional cash-on-delivery transaction
8 / 81
a. Documents against Payment
b. Documents against Acceptance
c. Cash in advance
d. Documentary Letter of Credit
33. 133. The banks involved in a

_____________________________ do not guaran-
tee payment or assume any credit risk, as they
do in__________________________. The banks act
merely as intermediaries to facilitate payment for a
shipment.
a. a documentary collection, documentary credit
transactions
b. documentary credit transactions, a documentary
collection
c. a Letter of credit, documentary credit transactions
d. a documentary collection, transferable credit
34. 134. In which of the following case may the seller a

agree to a documentary collection payment?
a. The seller does not doubt the buyer's ability and
willingness to pay for the goods
b. The buyer's country is not politically, economically,
and legally stable
c. There are some foreign exchange restrictions in the
buyer's country
d. The shipped goods are not easily remarketable
35. 135. A______________________________is the writ- a

ten promise of a bank, undertaken on behalf of a
buyer, to pay a seller the amount specified in the
credit provided the seller complies with the terms and
conditions set forth in thr credit.
a. documentary credit
b. documentary collection
c. transaction document
d. Cash in advance
36. 136 In a________________________________, banks b

act as intermediaries to collect payment from the
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buyer in exchange for the transfer of documents that
enable the holder to take possession o the goods
a. documentary credit
d. Open account
37. Which type of letter of credit (L/C) cannot be can- b

celled by the buyer, and a second bank (usually the
seller's bank) adds its guarantee of payment to that
of the buyer's bank?
a. Irrevocable unconfirmed L/C
b. Irrevocable confirmed L/C
c. Both Irrevocable confirmed L/C and Irrevocable
unconfirmed L/C
d. Back to back L/C
38. 138. Although_______________________provide c

good protection and are the preferred means of pay-
ment in many international transactions, they do have
limitations. For example, they do not ensure that the
goods actually shipped are as ordered not do they
insulate buyers and sellers from other disagreements
or compaints arising from their relationship.
a. clean collection
b. open account
c. documentary credits
d. cash in advance
39. 139. The Uniform Customs and Practice for Docu- a

mentary Credits (UCP) is the internationally recog-
nized codification of rules unifying banking practice
regarding____________________.
a. documentary credits
d. Cash in advance
40. 140. ___________________________initiates the doc- a

umentary credit process by applying to his bank to
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open a documentary credit naming the seller as the
beneficiary named.
a. The Buyer (Applicant/Importer)
b. The Issuing (Buyer's) Bank
c. The Advising (Seller's) Bank
d. The Seller (Beneficiary/Exporter)
41. 141. Upon instructions from the buyer, b

_______________________(typically the buyer's reg-
ular business bank) issues a documentary credit
naming the seller as the beneficiary and sends it to
the advising bank (typically the seller's bank), called
42. 142. Which party receives notification (advice) of d

the credit from the advising bank, complies with the
terms and conditions of the credit, and gets paid and
it is the beneficiary of the documentary credit.
43. 143. ________________________describes under a d

letter of credit the different ways in which payment
may be effected to the seller from the buyer through
the banks
a. Issurance
b. Amendment
c. Utilization
d. Settlement
44. 144. __________________usually sends the original b

documentary credit to the seller (called the beneficia-
ry) through an advising bank, which may be a branch
or correspondent bank of the opening bank
a. The buyer (applicant/importer)
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b. The issuing (buyer's) bank
c. The advising (seller's) bank
d. The seller (beneficiary/exporter)
45. 145. The_________________________will examine c

the credit upon receipt. It however, examines the
terms of the credit itself; it does not determine
whether the terms of the credit are consistent with
those of the contract between the buyer and seller, or
whether the description of goods is correctly stated
in accordance with the contract.
a. The buyer (applicant/importer)
b. The issuing (buyer's) bank
c. The advising (seller's) bank
d. The seller (beneficiary/exporter)
46. 146. ___________________________refers to the d

process of payment of the beneficiary(ies) to the
credit after presentation of documents under the
credit. Utilization, availability of payment and settle-
ment are all closely related and often the terms and
used interchangeably.
a. Issurance
b. Amendment
c. Utilization
d. Settlement
47. 147. _________________________________is the c

process of the seller shipping the goods, presenting
documentation and getting paid. Availability and set-
tlement are part of the same process, but refer more
specifically to the seller getting paid
a. Issurance
b. Amendment
c. Utilization
d. Settlement
48. 148. Means of settlement are a

a. settlement by payment, settlement by negotiation,
settlement by acceptance
12 / 81
b. settlement by acceptance, settlement by negotia-
tion
c. settlement by payment, settlement by negotiation
d. settlement by acceptance, settlement by payment
49. 149. In an unconfirmed credit, which of following b

banks has to make payment to the beneficiary if he
presents complied documents?
a. Confirming bank
b. Issuing bank
c. Advising bank
d. Central bank
50. 150. How many methods of hedging are there? c

a. Only 1 (Forward Market Hedge)
b. 2 (Forward Market Hedge, Money Market Hedge)
c. 3 (Forward Market Hedge, Money Market Hedge,
Options Market)
d. 4 (Forward Market Hedge, Money Market Hedge,
Options Market, Competitive Market Hedge)
51. 151. When the reputation of the issuing bank is strong a

enough to give confidence to the seller that he will
get paid, which following statement is the most rea-
sonable?
a. He can use an unconfirmed L/C
b. He must insist on a confirmed L/C
c. He should request the applicant to change the
issuing bank
d. He should exclude such issuing bank from the L/C
52. 152. In documentary credit ______________________ a

then sends the documentation package along with a
statement that it has accepted the draft by mail or by
courier to the issuing bank.
a. The advising/confirming bank
b. The buyer (Applicant/Importer)
c. The issuing (Buyer's) bank
d. The seller (Beneficiary/Exporter)
13 / 81
53. 153. The issuing bank does not c
a. review the document package making certain the
documents are in conformity with the terms of the
documentary credit
b. pay or reimburses the confirming bank at maturity
of the draft as previously agrred (in the documentary
credit)
c. amend or cancel the credit without the express
approval of the seller
d. None of these
54. 154. When the seller does not have confidence that d
the buyer's bank can effectively guarantee payment,
or when the seller fears economic, political, or legal
risk in the buyer's country, which type of letter of
credit (L/C) should best secure the seller?
a. Unconfirmed L/C
b. Unconfirmed and revolving L/C
c. Transferable L/C
d. Confirmed L/C
55. 155. The confirming bank does not c

a. reviews the document package making certain the
documentary credit
b. pays the seller
c. have certain quantities of the ordered goods de-
livered at specified intervals, such as in a multiple
delivery contract
d. None of these
56. 156. The issuing bank of a letter of credit does not: c

a. reviews the document package making certain the
documentary credit
b. pays or reimburses the advising/confirming bank
as previously agreed (in the documentary credit)
c. ensure that the goods actually shipped are as or-
dered not do they insulate buyers and sellers from
14 / 81
other disagreements or complaints arising from their
relationship
d. None of these
57. 157. Payment under an irrevocable documentary e

credit is guaranteed by the issuing bank. Howev-
er, from the seller's perspective, this guarantee may
have limited value as the issuing bank may be
a. in a foreign country
b. beholden to the buyer
c. small and unknown to the seller
d. subject to unknown foreign exchange control re-
strictions
e. One of these
58. 158. In dealing with a readily identifiable issuing bank a

in a developed country,
__________________________________________is
very probably an acceptable, safe instrument, for
most sellers. If you have any doubt about the issuing
bank and its standing, you can check the name
through a local bank with an international
department, called
a. An unconfirmed (or Advised) Documentary Credit
b. Confirmed Documentary Credit
c. Irrevocable Straight Documentary Credit
d. None of these
59. 159. An irrevocable unconfirmed documentary credit a

conveys a commitment by ___________________ to
honor drafts or documents as presented by the ben-
eficiary of the credit
a. The issuing bank
b. The confirming bank
c. Both issuing bank and confirming bank
d. None of these
60. 160. _________________________are often called a

nonperforming letters of credit because they are only
used if the collection on a promary payment method
15 / 81
is past due
a. Standby credits
b. Transferable credits
c. Back to back credits
d. Red clause credits
61. 161. ________________________has a special clause b

that authorizes the confirming bank to make ad-
vances to the beneficiary (seller) prior to the presen-
tation of the shipping documents
a. Standby credit
b. A red clause credit
c. Letter credit
d. Transferable credit
62. 162.____________________is one where the original a

beneficiary transfers all or part of the proceeds of an
existing credit to another party (typically the ultimate
supplier of the goods). It is normally used by middle-
men as a financing tool
a. A transferable credit
b. A standby credit
c. A red clause credit
d. A confirmed credit
63. 163. What is a new credit opened on the basis of an d

already existing, nontransferable credit? This is used
by traders to make payment to the ultimate supplier. A
trader receives a documentary credit from the buyer
and then opens another documentary credit in favor
of the ultimate supplier
b. Standby credit
d. Back-to-back credit
64. 164. ______________________________is an obliga- d

tion on the part of an issuing bank to pay a beneficia-
ry in the case of the nonperformance of the applicant
16 / 81
b. A revolving documentary credit
d. Standby documentary credit credit
65. 165. ___________________________________is an a

obligation on the part of an issuing bank to restore a
credit to the original amount after it has been utilized,
without the need for amendment.
a. A revolving documentary credit
b. A transferable credit
d. A standby documentary credit
66. 166. ___________________________________is a b

new documentary credit opened in favor of another
beneficiary on the basis of an already existing , irrev-
ocable, non-transferable documentary credit
b. A back-to-back documentary credit
c. A standby documentary credit
d. A red clause documentary credit
67. 167. Which is not mentioned in the list of points of d

consistency buyers, sellers, and banks should all be
aware of when preparing, presenting, and checking
documents for documentary credit and documentary
collection transactions?
a. Name and address of shipper, country of origin of
the goods
b. Description of the goods, quantities, units and is-
suer name and address
c. Invoice numbers, documentary credit numbers,
Shipping marks and numbers, Net weight, gross
weight, volume
d. Quality of goods
68. 168. ____________________________is the key ac- d

counting document describing the commercial trans-
action between the buyer and the seller.
a. Cherter Party Bill of Lading
17 / 81
b. Courier Receipt
c. Inspection cert
d. Commercial invoice
69. 169. ______________________________is a trans- c

port document covering port-to-port shipments. It is
not a title document, is not negotiable and cannot be
endorsed
a. Export License
b. A marine bill of lading
c. A non-negotiable sea waybill
d. Charter Party Bill of Lading
70. 170. ___________________________is a transport a

document covering port-to-port shipments of goods
issued by a party chartering a vessel (as opposed to
a named carrier or shipping line).
a. A charter party bill of lading
b. A marine bill of lading
d. Air waybill
71. 171. _____________________________is a document d

issued by the postal service of a country evidencing
receipt of goods for delivery to a named consignee.
a. Courier Receipt
b. Charter Party Bill of Lading
c. Packing List
d. Post receipt
72. 172. A copy of the packing list is pften at- d

tached to the shipment itself and another copy
sent directly to the consignee to asssit in check-
ing the shipment when received. It is also
called___________________________.
a. Inspection Certificate
b. Export License
c. Certificate of Origin
d. A bill of parcels
18 / 81
73. 173. ________________________________is used by a
a nation's customs authorities to control exports and
compile trade statistics. It is rarely a requirement of
the importer, buy rather is required of the exporter by
the export authorities.
a. The shipper's export declaration
b. Export License
d. A bill of parcels
74. 174. Which party has the responsbility of examining c

the documents package presented by the beneficiary
to make certain they are consistent with the docu-
mentary credit?
a. Remitting bank
b. Applicant
c. Issuing bank
d. Beneficiary
75. 175. In a confirmed letter of cred- a

it,_______________________________has the re-
sponsibility of examining the documents presented
by the issuing bank to determine if they are consis-
tent with the requirements of the documentary credit.
a. The confirming bank
b. The applicant
c. The issuing bank
d. The beneficiary
76. 176. What are the main concerns about electronic a

payment?
a. Privacy and security
b. Privacy and charged fees
c. Security and charged fees
d. Transfer Fee
77. 177. Which of the following document is a title docu- b

ment to the goods?
a. A straight bill of lading
b. A shipper's order bill of lading
19 / 81
d. An air waybill
78. 178. How are international payments in advance typi- b

cally conducted?
a. Cash or personcal cheque
b. Wire transfer or credit card
c. Consignment
d. Cash on delivery
79. 179. If a documentary credit does not contain a confir- b

mation request by the issuing bank, in certain circum-
stances the possibility exists of confirming the credit
by______________________________(without the is-
suing bank's knowledge). In this case the beneficiary
and the advising bank make an independent agree-
ment that adds the advising bank's confirmation to
the credit for a fee.
a. noisy confirmation
b. silent confirmation
c. the seller
d. the buyer
80. 1. In an international transaction it may take from a

several weeks to several months for merchandise to
find its way from the ware house of the _____ to the
warehouse of the_____
a. seller, buyer
b. buyer, importer
c. seller, producer
d. producer, bank
81. 2. Which obstacle is slowing adoption of faster, easier b

cross-border payments technologies?
a. Foreign exchange rates
b. Lack of payment systems interoperability
c. Incessant fraud
d. Language barriers
82. c
20 / 81
3. A shipment of encyclopedias published in the Unit-
ed States languished in customs in Calcutta because
a map of India showed the "de facto" border with
Pakistan indicating Pakistan's gains from a long-sim-
mering boarder war, rather than the government ap-
proved map that indicates all the territory as part of
India, is one of which risk?
a. Financial Risk
b. Political Risk
c. Legal Risk
d. Delivery Risk
83. 4. Which document is issued by the government au- a

thority of a country granting the right to export a
specific quantity of a commodity to specific country?
a. Export license
b. Country of origin
c. Inspection certificate
d. Packing list
84. 5. _______ wants (typically) the seller to bear the a

transportation and insurance costs and to have the
goods delivered to a local, home-country delivery
point where is ownership is assumed
a. Importer
b. Exporter
c. Producer
d. Banker
85. 6. ________ wants (typically) the buyer to bear the b

transportation and insurance costs and to deliver the
goods and transfer ownership at his own warehouse
or at a local port.
a. Importer
b. Exporter
c. Producer
d. Banker
86. 7. International transactions are ________________ a

domestic transactions and many things can happen
21 / 81
between the time of the sale and the expected time of
the payment
a. not as stable, secure, transparent, or reliable as
b. more stable, secure, transparent, or reliable than
c. as stable, secure, transparent, or reliable as
d. None of these
87. 8. ________________________are the most common d

form of international payment because they provide
a high degree of protection for both the buyer and
the seller. The buyer specifies the documentation re-
quired from the seller before the bank is to make pay-
ment, and the seller is given assurance that payment
will be make after shipping the goods so long as the
documentation is in order.
a. Open account
b. Cash in Advance
c. Transfers and Remitances
d. Letters of credit
88. 9. There are many ways of dealing with foreign ex- a

change risk and the simpleast, if you are seller, is
insiting on payment in:
a. Your own currency
b. Buyer's currency
c. Third party's currency
d. None of these
89. 10. A______________documentary credit is one d

where the beneficiary may request that part of the
proceeds (payment) of the credit be transferred to
one or more other parties who become second ben-
eficiaries
a. foreign exchange
b. back-to-back
c. original
d. transferable
90. 11. Which of the following is not the main party in a a

Letter of Credit?
22 / 81
a. Sales agent
b. Issuing bank
c. Applicant
d. Benificiary
91. 12. Political instability can lead to changes in trade c

policy, restrictions on foreign transfers, restrictions
on the importation of certain goods, a change in
monetary policy leading to devaluation of the local
currency, or nots and civil unrest that can cause loss
or damage to merchandise (potentially) not covered
by insurance, among other problems. Which risk is
mentioned?
a. Insurance Risks
b. Finance Risks
c. Political Risks
d. Money Transfer Risks
92. 13. Basic Terms of Payment are: d

a. Cash in Advance, Documentary Credit, Documen-
tary Collections
b. Cash in Advance, Documentary Collections, Open
Account
c. Cash in Advance, Documentary Credit, Open Ac-
count
d. Cash in Advance, Documentary Credit, Documen-
tary Collections, Open Account
93. 14. _________ payment terms cannot be required b

from buyers and this type of payment constitutes a
small proportion of payments made in international
transactions.
a. Open Account
b. Cash in advance
c. Documentary Collections
d. Letter of Credit
94. 15. A documentary letter of credit provides almost d

equal security to ______________ and is second only
to cash in advance in terms of security to the seller.
23 / 81
a. the seller
b. the buyer
c. the producer
d. both the buyer and the seller
95. 16. Letters of credit are the most common form of c

international payment because they provide a high
degree of protection for__________
a. the seller
b. the buyer
c. both the buyer and the seller
d. the broker
96. 17. In documentary credit, the key document is a

the_____________ or title document that authorizes
its holder to take possession of the shipment.
a. bill of lading
b. letter of credit
c. certificate of origin
d. packing list
97. 18. ____________________________is an order by c

the seller to his bank to collect payment from the
buyer in exchange for the transfer of documents that
enable the holder to take possession of the goods
a. An open account
b. A letter of credit
c. A documentary collection
d. A cash in advance
98. 19. Open Account provides the least risk for d

the ___________, and the greatest risk for
the______________.
a. seller, buyer
b. bank, buyer
c. customer, bank
d. buyer, seller
99. 20. For buyers, wisk is incurred when the goods d

shipped by the seller are not the quality or quan-
24 / 81
tity ordered. Therefore, from the seller's stand-
point,____________________falls somewhere in be-
tween a letter of credit and open account in its desir-
ability.
a. open account
b. cash in advance
c. letter of credit
d. documentary collection
100. 21. If you are an exporter, which provides the highest a

safety for you among following payment methods?
a. Document against payment
b. Document against acceptance
c. Clean collection
d. Open account
101. 22. Which payment method provides the buyer with c

the greatest security and flexible, but leaves the seller
at greatest risk that the buyer will not comply with
terms of the contract and pay as promised?
a. Cash in advance
b. Documentary collection
c. Open account
d. Documentary credit
102. 23. What currencies aren't widely used in internation- d

al payments?
a. The US dollar (USD). Euro and the Japanese yen
(JPY)
b. Euro and the RMB
c. Singapore Dollar (SGD) and the Japanese yen
(JPY)
d. Vietnam dong (VND), Malaysia Ringit (MYR)
103. 24. There are three common methods of hedging a

a. Forward Market Hedge, Money Market Hedge, Op-
tions Market
b. Forward Market Hedge, Labor Market Hedge, Op-
tions Market
c. Forward Market Hedge, Money Market Hedge, Com-
25 / 81
petitive Market
d. Upward Market Hedge, Money Market Hedge, Op-
tions Market
104. 25. A trader can lock in the rate at which he can buy or c
sell a foreign currency by buying, at the time the orig-
inal sale of merchandise (or services) agreement is
made, a forward contract to sell or buy that currency
with delivery set at the anticipated payment or receipt
date. What is this?
a. Money Market Hedge
b. Upward Market Hedge
c. Forward Market Hedge
d. Competitive Market
105. 26. Which contract provides protection against the b

risk of loss from a change in foreign exchange rate?
a. Sales contract
b. Heding contract
c. Representatives agreement
d. Distribution agreement
106. 27. If the seller receives an order of goods from an b

unknown buyer in unstable country, which of the fol-
lowing payment methods will provide the seller the
most safety?
a. Clean collection
b. Cash in advance
c. Documentary credit
d. Open account
107. 28. In a sales contract, this provision defines the time a

for shipment (i.e a shipment date, or a date of receipt).
Which is this provision?
a. Delivery provision
b. Price provision
c. Payment provision
d. Arbitration provision
108. a
26 / 81
29. ________________will make claims
against________________if the goods may not be
delivered, or delivery may be delayed or the wrong
goods, or goods of a different quantity or quality
may be delivered. Proper documentation might not
accompany the goods.
a. The buyer, the seller
b. The seller, the buyer
c. The seller, the bank
d. The bank, the buyer
109. 30. ________________________offers neutrality (in- d

ternational arbitration allows each party to avoid the
domestic courts of the other) and ease of enforce-
ment (foreign awards can be easier to enforce than
foreign court decisions).
a. buyer
b. seller
c. the bank
d. arbitrition
110. 31. In a sales contract, this provision defines what is c

being bought and sold. This provision often includes
the number of units or quantity, the type and quality.
What is this provision?
a. Documentation provision
b. Payment provision
c. Goods provision
d. Governing Law provision
111. 32. __________________________is a set of uniform a

rules codifying the interpretation of trade terms defin-
ing the rights and obligations of buyers and sell-
ers in international transactions. Developed and is-
sued by the International Chamber of Commerce
(ICC) in Paris, this version is publication from
__________________________________.
a. "Incoterms 2010", 2010
b. "Incoterms 2011", 2011
27 / 81
c. "Incoterms 2012", 2012
d. "Incoterms 2013", 2013
112. 33. In Incoterms 2010, this term represents the seller's a

minimum obligation, since he only has to place the
goods at the disposal of the buyer. The buyer must
carry out all tasks of export & import clearance. Car-
riage and insurance is to be arranged by the buyer.
What is this term?
a. EXWORKS
b. FCA
c. FOB
d. CIF
113. 34. In Incoterms 2010, this term means the seller a

delivers when the goods pass the ship's rail in port
of shipment. Seller must pay the costs and freight
necessary to bring the goods to the named port of
destination. BUT the risks of loss or damage, as well
as additional costs due to events occuring after the
time of delivery, are transferred from seller to buyer.
Seller must clear goods for export. What is this term?
a. CFR
b. FCA
c. FOB
d. CIF
114. 35. An unconditional order in writing, signed by a a

person (drawer) such as a buyer, and addressed to
another person )drawee), typically a bank, ordering
the drawee to pay a stated sum of money to yet
another person (payee, often the seller, on demand or
at a fixed or determinable future time is
a. Draft
b. Agreement
c. Contract
d. Discussion
115. 36. An/A_____________________________is a time b

draft that has been accepted and signed by the
28 / 81
drawee (the buyer or the bank) for payment at matu-
rity.
a. Rejection
b. Acceptance
c. Discussion
d. Agreement
116. 37.A_______________________acceptance for a b

draft is one that does not have any notations attached
that would compromise its value.
a. "dirty"
b. "clean"
c. "full"
d. "partial"
117. 38. In documentary collec- c

tion,___________________________act as intermedi-
aries to collect payment from the buyer in exchange
for the transfer of documents that enable the holder
to take possession of the goods.
a. Sellers
b. Buyers
c. Banks
d. Brokers
118. 39. The bank does not act as surety of a

__________________ but rather only as collector of
funds for documents.
a. payment
b. expenditure
c. cost
d. transfer
119. 40. In a ______________, the seller prepares and pre- a

sents documents to the bank in much the same way
as for a________________________________.
a. Documentary collection, documentary letter of
credit
b. Banking procedure, documetary letter of credit
29 / 81
c. Documentary collection, banking procedure
d. Documentary credit, cash in advance
120. 41. In documentary collection, the seller's bank has b

no obligation to pay upon presentation but more sim-
ply, acts as a___________________ on behalf of the
seller, thus earning commission for its services.
a. Confirming bank
b. Remitting bank
c. Issuing bank
d. Advising bank
121. 42.The______________________is the international- a

ly recognized codification of rules unifying banking
practice regarding collection operations for drafts
and for documentary collections
a. Uniform Rules for Collection (URC)
b. Letter of Credit
c. Contract
d. Agreement
122. 43. Main parties to a documentary collection transac- d

tion are
a. Drawee, Drawer, Remitting bank only
b. Drawee, Presenting/Collecting bank, Remitting
bank only
c. Drawee, Drawer, Presenting/Colleting bank only
d. Drawee, Drawer, Presenting/Collecting bank, Re-
mitting bank
123. 44. Main parties of Documentary Collection are d

a. Bill of Lading, Certificate of Origin
b. Certificate of Origin, Delivery Notice
c. Packing List, Certificate of Origin
d. The Principle (Seller/Exporter/Drawer), The Remit-
ting (Principal's/Seller's/Exporter's) Bank, The Collet-
ing or Presenting (Buyer's) Bank, The Drawee (Buy-
er/Importer?
124. c
30 / 81
45. In documentary collections, which party presents
the documents to the buyer and collects cash pay-
ment (payment of a bank draft) or a promise to pay in
the future (a bill of exchange) from the buyer (drawee
of the draft) in exchange for the documents?
Bank
125. 46. In documentary collection, the seller (principal) d

prepares and presents (remits) a document package
to his bank (the remitting bank) consisting of
a. a collection order specifying the terms and con-
ditions under which the bank is to hans over docu-
ments to the buyer and receive payment
b. the negotiable transport document (bill of lading)
c. other documents (e.g., insurance document, certifi-
cate of origin, inspection certificate, etc.) as required
by the buyer
d. All of these
126. 47. In documentary collection, which of the following c

is NOT the dirty of the buyer (drawee)?
a. Make a payment, or if the collection order allows,
signs an acceptance (promise to pay at a future date)
b. Receive the documents and takes possession of
the shipment
c. Prepare documents and sends them to the bank to
claim payment
d. None of these
127. 48.The___________________________bank pays b

the______________________bank either with an im-
mediate payment or, at the maturity date of the ac-
cepted______________________
a. Collecting, bill of exchange, remitting
b. Collecting, remitting, bill of exchange
31 / 81
c. Remitting, Collecting, bill of exchange
d. Bill of exchange, Collecting, remitting
128. 49. Types of Collections are d

a. Letter of credit, cash payment
b. Commercial Invoice, Certificate of Origin, Packing
List
c. Pro-forma Invoice, Delivery Notice
d. Documents against Acceptance (D/A), Docu-
ments against Payment (D/P), Acceptance Docu-
ments against Payment
129. 50. The collecting bank is permitted to release the b

documents to the buyer against acceptance (signing)
of a bill of exchange or signing of a time draft at the
bank promising to pay at a later date (usually 30,60,
or 90 days), called
a. Documents against Payment (D/P)
b. Documents against Acceptance (D/A)
c. Acceptance Documents against Payment
d. All of these
130. 51.Which of the following statements is false? d

a. URC is a set of rules to aid bankers, buyers, and
sellers in the Collection process
b. UCP is a set of rules published by the International
Chamber of Commerce (ICC) on the insurance and
use of Letters of credit
c. The latest version of UCP is UCP600 which was
effective in 2007
d. UCP is a set of rules published by the International
Chamber of Commerce (ICC) on the insurance and
use of both Letters of credit and Collection
131. 52. If the buyer refus- a

es_______________________________(in D/P terms)
or ___________________(in D/A terms), the seller re-
tains ownership of the shipment. The seller may have
the goods shipped back or try to sell them to another
buyer. If the buyer takes no action, customs may seize
32 / 81
the goods and auction or otherwise dispose of them.
a. payment, acceptance
b. delivery term, payment
c. acceptance, payment
d. letter of credit, cash in advance
132. 53. Parties to the basic documentary letter of credit a

transaction include
a. The Buyer (Applicant/Importer), The Issuing (Buy-
er's) Bank, The Advising (Seller's) Bank, The Seller
(Beneficiary/Exporter)b. The Issuing (Buyer's) Bank,
The Advising (Seller's) Bank, The Seller (Beneficia-
ry/Exporter)c. The Advising (Seller's) Bank, The Seller
(Beneficiary/Exporter)d. The Seller (Beneficiary/Ex-
porter), The Issuing (Buyer's) Bank
133. 54. Upon instructions from the issuing bank and the c
buyer, _______________________(typically the sell-
er's bank) advises the seller of the credit. This party
is typically the seller's regular business bank ans is
in the seller's country, called
134. 55______________________________describes the a

process of the buyer's applying for and opening a
documentary credit at the issuing bank and the is-
suing bank's formal notification of the seller through
the advising bank.
a. Issuance
b. Amendment
c. Utilization
d. Settlement
135. 56.______________________describes the process b

whereby the terms and conditions of a documentary
credit may be modified after the credit has been is-
sued
33 / 81
a. Insurance
b. Amendment
c. Utilization
d. Settlement
136. 57.____________________describes the procedure c

in documentary credit for the seller's shipping of the
goods, the transfer of documents from the seller to
the buyer through the banks, and the transfer of the
payment from the buyer to the seller through the
banks (settlement)
a. Issuance
b. Amendment
c. Utilization
d. Settlement
137. 58. Which of the following statements is false? a

a. In letter of credit, the banks are responsible for
checking and making sure that the goods is actually
shipped by the exporter to the importer.
b. Using letter of credit can provide protection and
security to both buyers and sellers
c. The lastest version of UCP is UCP600.
d. In letter of credit, the issuing bank will make pay-
ment to the beneficiary provided that the beneficiary
presents complied documents.
138. 59. The Uniform Customs and Practice for Documen- a

tary Credits (UCP) is issued by:
a. International Chamber of Commerce (Paris)
b. World Bank
c. International Monetary Fund
d. United Nations
139. 60. If the_________________________credit and rela- a

tionship with the bank is excellent, the bank will issue
a credit for the full value.
a. Buyer's
b. Seller's
34 / 81
c. Producer's
d. Broker's
140. 61. After receiving a letter of credit (L/C) the bene- d

ficiary (seller) finds that the transaction price listed
in the L/C is lower than the originally agreed price
in the sales contract between them and the applicant
(buyer). What should the beneficiary do?
a. The beneficiary does not need to do any action
because it has no effect on his turnover
b. The beneficiary can change the content of L/C him-
self and then notifies to the applicant
c. The beneficiary should request for a confirmation
adding from confirming bank
d. The beneficiary should request for an amendment
from issuing bank for this L/C
141. 62. If the credit is a(an)_________________________, a

confirmed credit, the value of the credit is available
to the beneficiary as soon as the terms and condi-
tions of the credit have been met (as soon as the
prescribed document package has been presented to
and checked by the confirming bank)
a. Irrevocable
b. Transferable
c. Reasonable
d. Unreasonable
142. 63. In settlement by acceptance the beneficiary c

presents the required documentation package to
the bank along with a time drafy drawn on the
___________________________ for the value of the
credit.
a. Importer (Applicant)
b.Exporter (Beneficiary)
c. Issuing bank
d. Shipper
143. 64.The______________ships the goods to the buyer a

and obtains a negotiable transport document (nego-
35 / 81
tiable bill of lading) from the shipping firm/agent.
a. Seller
b. Buyer
c. Customs broker
d. Banker
144. 65. ____________________by a second bank is the c

equivalent of added insurance, and insurance costs
money, so this form of L/C is more costly.
a. Insurance
b. Cancellation
c. Confirmation
d. Amendment
145. 66. The confirming bank of a letter of c

credit (L/C) will pay even if the issuing
bank can not make payment. Therefore, it
is _________________________for the beneficiary
and ______________________________than uncon-
firmed L/C
a. less secured, less expensive
b. less secured, more expensive
c. more secured, more expensive
d. more secured, less expensive
146. 67______________________________gives the buyer a

and/or issuing bank the ability to amend or cancel the
credit at any time right up to the moment of intended
payment without approval by, or notice to, the seller
a. A revocable documentary credit
b. A documentary collection
c. A transaction document
d. An irrevocable documentary credit
147. 68. What is one that contains a guarantee on the part d

of both the issuing and advising banks of payment
to the beneficiary (seller) so long as the terms and
conditions of the credit are met
a. Irrevocable Unconfirmed Documentary Credit
b. Unconfirmed Documentary Credit
36 / 81
c. Transferable Credit
d. Irrevocable Confirmed Documentary Credit
148. 69._______________________________________is a a
mechanism for providing funding to the seller prior
to the shipment of goods. It is often used to assist
manufacturers in paying for labor and materials used
in manufacturing or to middlemen who need financ-
ing to conclude a transaction
a. A red clause credit
b. A revolving documentary credit
c. A transferable credit
d. A standby documentary credit
149. 70 _____________________________is used by a d

"middlemen" who acts as an intermediary between a
buyer and a seller to earn a profit for structuring the
transaction
b. A red clause credit
c. A standby documentary credit
d. A transferable credit
150. 71. Sellers have reported receiving an advice a

or a confirmation of a documentary credit
from non-existing banks. The perpetrator of the
_____________________________attempts to get the
seller to ship goods and present documents for pay-
ment to a bank that does not exist. By the time the
seller is aware of the_____________________, the
"buyer" has received the goods
a. Fraud, fraud
b. True, fraud
c. Good, fraud
d. Bad, fraud
151. 72. ________________________is a document issued a

by a carrier to a shipper, signed by the captain, agent,
or owner of a vessel, finishing written evidence re-
garding receipt of the goods (cargo), the conditions
37 / 81
on which transportation is made (contract of car-
riage), and the engagement to deliver goods at the
prescribed port of destination
a. A bill of lading
b. Certificate of Testing
c. Air Transport Document
d. Shipper's Export Declaration (SED)
152. 73._______________________________is a notation d

on a bill of lading indicating that the goods have in
fact been loaded on board or shipped on a named
vessel
a. Courier Receipt
b. Charter Party Bill of Lading
c. Export License
d. "On board"
153. 74. __________________________is a transport doc- b

ument covering port-to-port shipments of goods (for
carriage of goods solely by sea)
a. Export License
b. exparine bill of lading
c. Courier Receipt
d. Air waybill
154. 75. __________________________is a bill of lading d

covering two or more modes of transport, such as
shipping by rail and by sea
a. Issurance Document
b. Certificate of Origin Form A
d. A multimodal transport document
155. 76. A document issued by an authority, as stated in a

the documentary credit, indicating that goods have
been inspected (typically according to a set of indus-
try, customer, government, or carrier specifications)
prior to shipment and the results of the inspection,
called
a. Inspection Certificate
38 / 81
b. Export License
d. Shipper's Export Declaration
156. 77. A letter of credit (L/C) is issued in USD and re- a

quires to present an insurance certificate. Which of
the following insurance certificate can be accepted
under this L/C?
a. An insurance certificate which is issued in USD
b. An insurance certificate which is issued in EUR
c. An insurance certificate which is issued in GBP
d. An insurance certificate which is issued in VND
157. 78. What is e-payment? a

a. Electronic payment for buying and selling through
the Internet
b. Payment of online software
c. Payment of online services
d. None of these
158. 79. What is the main driver of electronic payment c

growth?
a. Consumer demand for new methods
b. Government regulation
c. Technology development
d. None of these
159. 80. What is Bitcoin? b

a. An online payment blog
b. First decentralized digital currency
c. Cash in advance in another currency
d. Internet Banking
160. 81. According to UCP 600, which of the following is c

true for commercial invoice?
a. Description of the goods in the commercial invoice
no need to correspond precisely with the description
of goods in the documentary credit.
b. The invoice no need to be made out in the same
currency with the currency of the L/C
39 / 81
c. The invoice must be issued by the beneficiary.
d. None of these
161. 82. A buyer bears highest risks d

under_________________________________pay-
ment method:
a. Letter of Credit
b. Open Account
c. Documents against payment
d. Cash in Advance
e. Documents Against Acceptance
162. 83. What is a notation on a bill of lading indicating that a

the goods have in fact been loaded on it or shipped
on a named vessel? This notation may be made by
the carrier, his agent, the master of the ship, or his
agent.
a. "On board" notation
b. "In board" notation
c. "Up board" notation
d. "Down board" notation
163. 84. Which of the following statements is true in CFR a

(Incoterms 2010)?
a. Seller must pay the costs and freight necessary to
bring the goods to the named port of destination, but
the risks of loss or damage, as well as any additional
costs due to events occuring after the time of deliv-
ery, are transferred from seller to buyer.
b. The seller must clear for import in buyer's country
c. The seller must take the risks of loss or damage
until the goods arrived at port of destination
d. The seller has an obligation to cover the insurance
of goods
164. 85.What parties can take part in the process of Elec- a

tronic Commerce?
a. Cardholder, Merchant, Issuer, Acquier, Certification
Authority
b. Merchant, Issuer, Acquier, Certification Authority
40 / 81
c. Cardholder, Merchant, Issuer, Acquier
d. Merchant, Issuer, Acquier
165. 86. Who needs funds for payment and during the a
period before resale of goods, and prefers that the
seller finance the transaction?
a. Importer/buyer
b.Exporter/seller
c. Insurance Company
d. Bank
166. 87. Who needs funds for production and the period b
before payment is received, and prefers that the buyer
finance the transaction?
a. Importer
b. Exporter
c. Bank
d. Freight forwarder
167. 88. An United States exporter ships goods with value a

of USD 100.000 to a Vietnamese importer. Payment
must be made in USD.At the time of shipment, 1USD=
22.100 VND. However, at the time of payment (for ex-
ample, 30 days after shipment date), the exchange
rate has changed to 1 USD=22.050 VND. In this case,
who gets the benefits of currency fluctuation?a. A
Vietnamese importer
b. An United States exporter
c. A broker
d. None of these
168. 89. __________ wants (typically) to make payment in a

own currency or in a currency that is expected to
decrease in value between the date of the contract
and date of the payment.
a. Importer
b. Exporter
c. Seller
d. Exporter's Bank
41 / 81
169. 90. __________ wants (typically) to receive payment b
in own currency, a hard currency, or in a currency that
is expected to increase in value between the date of
the contract and date of the payment.
a. Importer
b. Exporter
c. Bank
d. Buyer
170. 91. The _________ is in the business of purchasing or c

the brokering of raw materials; component parts; fin-
ished goods; or srvices for manufacturing, assembly,
or resale to others.
a. freight forwarder
b. bank
c. buyer/importer
d. insurance company
171. 92. The seller may be acting as a (an) b

___________________ and be unable to ship the
goods before making payment to his supplier, or the
seller may be unable to make paymet before getting
paid himself.
a. Importer
b. Broker
c. Insurance Company
d. Bank
172. 93. A contract signed in a foreign country was ruled c

invalid because the trader was improperly in the
country on a tourist visa, is one of which risk?
a. Financial Risk
b. Political Risk
c. Legal Risk
d. Delivery Risk
173. 94. Surplus balance of trade means b

a. value of imports > value of exports
b. value of exports > value of imports
42 / 81
c. price of exports > price of imports
d. quantity of exports > quantity of imports
174. 95. The uses of a/an ________________ documentary b

credit are similar to those of transferable credit. The
seller intermediary uses the financial strength of the
buyer to effect the transaction
a. foreign exchange
b. back-to-back
c. original
d. intermediary
175. 96. How many times can a transferable L/C be trans- a

ferred?
a. Only once
b. Twice
c. Three times
d. Four times
176. 97. In 2018, which of the following countries opened d

its market to let foreign payment card companies
provide mobile payment services?
a. U.S
b. India
c. Australia
d. China
177. 98. The buyer and the seller may be separated by d

many thousands of miles. What is the concern of the
buyer if it takes sixty days for the goods to arrive
at the seller's warehouse and the buyer is going to
be required to pay prior to receipt of the shipment
and pays the financing costs while the goods are in
transit?
a. Condition of goods
b. Timeliness of receipt of goods
c. Quality of goods
d. Lag time
178. c
43 / 81
99. In almost all business transactions the buyer
would prefer to obtain easy and free long-term credit.
In many instances, the buyer will not possess suffi-
cient working capital to make an outright cash pur-
chase of goods. What is the concern of the buyer in
international transactions according to above state-
ment?
a. Lag time
b. Timeliness of receipt of goods
c. Financing the transaction
d. Condition of goods
179. 100. The cost and particulars of ____________ wiil be a

of concern to the buyer especially when the terms
of the contract specify that the buyer is responsible
for_________costs from the seller's door or from the
port of embarkation of the seller's country
a. Insurance
b. Quantity of goods
c. Sales of goods
d. Origin of goods
180. 1. In most case, a draft accepted by bank enjoys A

______________ credit standing than a draft accept-
ed by a company and individual.
A. Higher
B. Lower
C. None of the above
181. 2. The draft with tenor "45 days after shipment date D
(shipment date: 15 June 2019) is called:
A. Time draft
B. Sight draft
C. Usance draft
D. Both A and C are correct
182. 3. Which is the internationally recognized of rules A

unifying banking practice regarding collection oper-
ations for drafts and for documentary collections?
A. URC522
44 / 81
B. URC600
C. UCP600
D. All of the above
183. 4. Rosemary Co Ltd is a Germany exporter and they A

submits the collection documents to his bank (Clar-
ing Bank JSC) with a collection order for payment
from the buyer Jian Co., Ltd in Hongkong. In this case,
who is the principal?
A. Rosemary Co Ltd
B. Claring Bank JSC
C. Jian Co.,Ltd
D. Both Rosemary Co Ltd and Jian Co.Ltd
184. 5. In D/A terms, the buyer may accept the draft, take A
possession of the goods, but then refuse to pay the
draft at maturity.
A. True
B. False
185. 6. The seller is now doing a Collection transaction un- B

der URC522 at his bank. He presents the documents
to the bank and insists that the bank is under obliga-
tion to authenticate his documents. Do you agree with
the seller?
A. Yes
B. No
186. 7. In collection transaction, the seller must prepare C

________________ in which specifies the terms and
conditions of the documentary collection. The banks
are only permitted to act upon the instructions given
in this to handle the transaction.
A. Certificate of origin
B. Bill of exchange
C. Collection order
D. Commercial invoice
187. 8. According to URC 522, if a collection remains un- C

paid or a bill of exchange is not accepted, may the
45 / 81
collecting bank return the documents to the bank
from which it received the collection order?
A. No
B. Yes for all cases
C. Yes, but only in the case the collecting bank re-
ceives no new instruction within 90 days
D. Yes, but only in the case the collecting bank re-
ceives no new instruction within 180 days
188. 9. The URC are applied worldwide but it is not manda- A

tory that a collection instruction incorporate these
rules
A. True
B. False
189. 10. If URC is incorporated into the Collection instruc- B

tion, it overides law
A. True
B. False
190. 11. According to URC 522, banks are not bound to A

handle any collection instruction. They can refuse to
handle collection on a case-by-case basis
A. True
B. False
191. 12. In a documentary collection transaction, the B

banks must examine the documents in detail to en-
sure that such docments are complied with terms and
conditions in the sale contract
A. True
B. False
192. 13. Banks receiving collections must determine that A

the documents received appear to be listed in the
collection instruction
A. Always
B. When requested
C. Never
46 / 81
193. 14. Under a sight documentary collection, for what A
reason is the buyer exposed to only minimal risk?
A. Because it need only pay when it has received and
review the original shipping documents
B. Becuase it need only pay when it has reviewed the
original shipping documents at the counters of the
collecting bank
C. Becuase it need only pay when it has review the
original shipping documents at the counters of the
remitting bank
194. 15. Under documentary credit, complying presenta- C

tion means a presentation that is
A. Within LC validity only
B. Presenting of all shipping documents
C. In accordance with LC terms & conditions
195. 16. If the beneficiary is not happy with the term & B
conditions of L/C, he can ask applicant for
A. Fresh letter of credit (replacement)
B. An amendment
C. Applicant confirmation
196. 17. Issuing bank is bound by a letter of cred- A

it___________
A. From the time of issue LC
B. From the time the LC is advised by the advising
bank
C. From the time LC is received by the beneficiary
197. 18. An irrevocable credit can neither be amended C

not cancelled without the agreement of the following
parties
A. The issuing bank & the confirming bank
B. The confirming bank & the beneficiary
C. The issuing bank, the beneficiary and the confirm-
ing bank (if any)
198. 19. In the context of a documentary credit, the "open- A

ing" Bank is also called the?
47 / 81
A. Issuing bank
B. Advising bank
C. Confirming bank
D. Nominated bank
199. 20. UCP 600 cover the inssuance for revocable cred- B
its. Is this statement True or False?
A. True
B. False
200. 21. When is an issuining bank irrevocably bound by B

an amendment?
A. When it approves the request of the applicant
B. When it issues the amendment
C. When the advising bank or confirming bank advis-
es the amendment
D. When the beneficiary receives the amendment
201. 22. An amendment contains three changes to the B

terms and conditions of the documentary credit. The
beneficiary may accept any combination of those
changes and any unaccepted changes will be con-
sidered as disregarded and the issuing bank will be
bound only by the accepted amendment. Is this state-
ment true or false?
A. True
B. False
202. 23. The fundamental principle of documentary cred- C

it is that banks deals in _________ and not
____________
A. Goods, documents
B. Goods, charges
C. Documents, goods
D. Documents, charges
203. 24. __________ describes the procedure for the sell- C

er's shipping of goods, the transfer of documents
from the seller to the buyer through the banks, and
the transfer of payment from the buyer to the seller
48 / 81
through the banks (settlement)
A. Insurance
B. Amendment
C. Utilization
D. Guarantee
204. 25. According to article 4 UCP600, as a credit and a A

________ are separate transactions, banks need not
to be required to check documents presented against
the latter document
A. Sales contract
B. Performance bond
C. Guarantee
205. 26. In letter of credit, the importer often plays the role A
of
A. Applicant
B. Beneficiary
C. Issuing bank
D. Advising bank
206. 27. In doucmentary credit, the buyer will be assured B

by the bank that he will receive the goods with right
quality and quantity as specified in his sales contract
A. True
B. False
207. 28. On 01 June, the applicant in Vietnam has request- B

ed his bank (Bank A) to issue a letter of credit in favor
of the beneficiary in Thailand. On 05 June, the benefi-
ciary contacts the applicant and complains that there
are 05 points he does not satisfy with this L/C. At the
request of beneficiary, the applicant request another
bank in Vietnam (bank B) to issue this amendment.
According to UCP600, do you agree with the applicant
in the usage of another bank to issue such amend-
ment?
A. Yes, the applicant can choose any bank to amend
L/C, provided that bank can offer competitive fee
B. No, the applicant must use the same channel as
49 / 81
original L/C (i.e must use Bank A) to issue the amend-
ment
208. 29. Under L/C, there are 03 types of Availability: the B

sight L/C (settlement by __________), the usance L/C
(settlement by ___________) and the deferred pay-
ment (settlement by _______-_
A. Acceptance, payment, negotiation
B. Payment, acceptance, negotiation
C. Negotiation, acceptance, payment
D. Acceptance, negotiation, payment
209. 1. A hedge is a contract that provides protection A

against the risk of loss from a change in _________
A. Foreign exchange rates
B. Inflation
C. Interest rate
D. None of the above
210. 2. There are 03 common methods of hedging: forward A

market hedge, money market hedge and option mar-
ket
A. True
B. False
211. 3. A "put" option gives the buyer the _________, but A

not the _______________ to sell a specified number
of foreign currency units to the option seller at a fixed
dollar price, up to the option's expiration date
A. Right, obligation
B. Obligation, right
212. 4. Which of following payment method provides B

greatest security for seller and greatest risk for buy-
er?
A. Open account
B. Cash in advance
C. Documentary credit
D. Letter of credit
50 / 81
213. 5. ____________________ is a bank's commitment B

to pay the seller a specified sum on behalf of the
buyer under precisely defined conditions. The seller
is assured that payment will be received after the
goods are shipped so long as they have presented
the complying documents
A. Collection order
B. Letter of credit
C. Letter of commission
D. Agreement of credit
214. 6. In letter of credit transaction, the bank deals only A

with the documents regarding the goods rather than
the goods themselves
A. True
B. False
215. 7. Similar to letter of credit, banks in documentary B

collection involved will always guarantee payment for
the seller
A. True
B. False
216. 8. D/P stands for: C

A. Delivery against payment
B. Delivery against promise
C. Documents against payment
D. Documents against promise
217. 9. You work for a small United States importer of tex- D

tiles. You are negotiating a supply contract with a very
large Italian exporter. Which of the following devices
could help protect your company from currency risk?
A. Put in a contract clause under which you share the
currency fluctuation risk with the seller
B. Specify that payment will be made in US dollars
C. Accept that payment will be in Euro, but then use
currency hedging via a forward exchange contract to
look in the exchange rate in force when the contract
51 / 81
is signed
D. All of the above are devices that would help protect
your company from currency risk
218. 10. An exporter agrees to sell a container of a certain B

type of merchandise for 10,000 (ten thousand) euro
CIP Incoterm 2010. The exporter is aware that under
CIP terms he must insure the goods properly. For how
much value should he obtain insurance coverage?
A. 10,000 EUR
B. 11,000 EUR
C. 1,000 EUR
D. NOne of the above
219. 11. The description of the goods in an export con- A

tract is: "titanium alloy widgets" (a made-up term for
a technical item). When the goods arrive, however,
the importer discovers that the widgets delivered are
60% titanium widgets, while he was expecting the
higher-quality 90% titanium widgets. If the importer
sues for breach of contract, who will win?
A. Exporter will win, because the goods fit the con-
tract description
B. Importer will win, because the courts will apply
custom of trade
C. Importer will win, because the courts will look to
the buyer's expectation
220. 12. An Australia exporter and a Chinese iraporter A

negotiate a contract specifying "CIP Incoterm" (but
without any further detail on which version of In-
coterm to apply) signed in 2010, for goods to be
delivered in monthly installments over an 18-month
period in 2011 and 2012. Which version of Incoterms
should apply to this transaction?
A. Incoterm 2010
B. Incoterm 2011
C. Australian Incoterms
D. Chinese Incoterms
52 / 81
221. 13. Incoterms specify the rights and responsibilities D
of the parties principally in what type of international
contract?
A. Purchase Order
B. Contract of carriage
C. Shipping contract
D. Sale contract
222. 14. Which contract clause protects both sides in the C

event that there is an unforesecable event (some-
times called an "act of God") that prevents one of
them from fulfilling the contracting
A. "Choice of law" clause
B. "Liquidated damages" clause
C. "Force majeure" clause
D. Insurance
223. 15. Which of the following statements best describes C

INcoterm 2010?
A. Incoterms 2010 are a set of binding international
laws that have global application in contracts of sale
between exporters and importers
B. Incoterms 2010 are international commercial reg-
ulations that become effective with enforcement by
individual governments around the world
C. Incoterms 2010 are a set of rules applying to the
contract of sale which become effective by voluntary
incorporation into the contract of sale
224. 16. In Incoterms 2010, the place of delivery is always B

the place of destination of the goods.
A. True
B. False
225. 17. Which of these Incoterms represents the LEAST D

responsiblity for the exporter?
A. CIF
B. DAT
C. DDP
D. EXW
53 / 81
226. 18. Is a Documentary credit also known as a "letter of A

credit", "commercial credit" or "L/C"?
A. True
B. False
227. 19. An Amercian exporter is delivering goods to La- B

guardia Airport in New York for air shipment to Berlin,
and the air freight and insurance coverage is to be
arranged for and paid by the importer. The correct
Incoterm in such circumstances would be:
A. DDP Berlin Incoterms 2010
B. FCA Laguardia Airport Incoterms 2010
C. FOB Airport Laguardia Incoterms 2010
D. CPT Berlin Incoterms 2010
228. 20. Which of the following Incoterms does the buyer D

pay for main carriage?
A. DDP
B. DAP
C. CIP
D. FCA
229. 21. Purchase on open account means that the buyer B

agrees to pay for goods ordered immediately, i.e on
the same day with shipment date
A. True
B. False
230. 22. An import buyer in Mexico is seeking to arrange A

the cheapest final cost to its company of purchasing
merchandise from Bordeaux sea port, France. The
French exporter has offered two price quotes:
1. 2500 Euro per container FOB Bordeaux port,
France, Incoterms 2010, or
2. 3100 per container CIF Veracruz sea port, Mexico,
Incoterms 2010.
The importer calls its own freight forwarder and asks

for a frieght + insurance quote from Bordeaux to
54 / 81
Veracruz for this merchandise. The forwarder says
that freight and insurance will cost the equivalent of
525 Euro per container from Bordeaux to Veracruz.
On which Incoterm should the importer base its Pur-
chase Order? (Assume that the importer is more con-
cerned about total cost than about risk)
A. FOB Bordeaux
B. CIF Veracruz
C. FAS Bordeaux
D. EXW
231. 23. Under a documentary collection, the buyer's bank A

is instructed not to transfer the documents to the
buyer until payment is made (i.e__________), or upon
guarantee that payment will be made within a speci-
fied period of time (i.e______________)
A. D/P, D/A
B. D/A, D/P
C. Cash in advance, open account
D. Open account, cash in advance
232. 24. Under this group of Incoterms 2010, the point C

of delivery (transfer of risk) from the seller to the
buyer is at the point of shipment. However, this group
extend the seller's obligation with regard to the cost
of carriage and insurance (if any) up to the point of
destination. Which group is mentioned here?
A. Group E term (EXW)
B. Group F terms (FCA, FAS, FOB)
C. Group C terms (CFR, CIF, CPT, CIP)
D. Group D terms (DAT, DAP, DDP)
233. 25. Which of the follwing is NOT covered under In- D

coterms?
A. Transfer of title
B. Payment terms or methods
C. Task, cost and risk of buyer and seller associated
with the transportation and delivery of goods
55 / 81
D. Both A and B
E. Both B and C
234. 26. As defined in Uniform Rules for Collection - URC B

522, the bank that is responsible for making the doc-
uments available to the drawee is known as
A. the remitting bank
B. the presenting bank
C. the reimbursing bank
235. 27. Which of the following is not a commercial docu- A

ments?
A. Bill of exchange
B. Bill of lading
C. Commercial invoice
D. Packing list
236. 28. In documentary collection, the party who initiates B

the collection is called:
A. drawee
B. principal
C. remitting bank
D. presenting bank
237. 29. In __________ , when an issuing bank determines B

that a presentation is complying, it must honour its
undertaking to make settlement to the beneficiary
even if the importer has not yet received the goods.
A. Documentary collection
B. Documentary credit
C. Cash in advance
D. Open account
238. 30. What is the international treaty that aids parties C

in giving the Award coercive power, allowing cross-
border implementation of awards made in other coun-
tries?
A. The 1961 Vienna Convention on Diplomatic Rela-
tions
B. The 1980 United Nations Convention on Contracts
56 / 81
for the International Sale of Goods
C. The 1958 New York Convention on the Recognition
and Enforcement of Foreign Arbitral Awards
239. 1. According to UCP600, the issuing bank has 07 B

banking days following day of presentation in which
to determine if the documents comply
A. True
B. False
240. 2. An exporter is willing to release the shipping docu- A

ments directly to the buyer, but wishes to retain some
guarantee of payment if the buyer fails to pay on the
due date.
Which type of documentary credit best suits the ex-
porters needs?
A. Standby
B. Transferable
C. Revolving
D. Evergreen
241. 3. Which form of credit might enable a beneficiary to B

obtain pre-shipment financing without impacting on
their credit facility?
A. Transferable LC
B. Red Clause LC
C. Confirmed LC
D. Standby LC
242. 4. The buyer and seller agree that goods will be A

shipped on a continuing basis (i.e USD 10,000.00 per
month rom January to June 2019). They also want to
establish one L/C to handle all the shipments rather
than to establish individual L/C for each shipment.
Which type of L/C should they use in this case?
A. Revolving L/C
B. Transferable L/C
C. Back to back L/C
D. Standby L/C
57 / 81
243. 5. One of the disadvantages of the buyer in red clause A
L/C is that the seller may not excute the contract and
the buyer may totally lose the paid advances
A. True
B. False
244. 6. Which type of L/C is often called "non-performing D

L/C" because they are only used as a backup payment
method if the collection in a primary payment method
is past due?
A. Transferable LC
B. Back to back L/C
C. Red Clause L/C
D. Standby L/C
245. 7. Transferable L/C can be transferred in C

______________
A. in whole only
B. in part only
C. in whole or in part
246. 8. Transferable L/C can be transferred more than once B

time. It means that a second beneficiary can transfer
to a third beneficiary
A. True
B. False
247. 9. Which term can the intermediary change from the D

original L/C when transferring L/C?
A. Unit price
B. Amout of the L/C
C. Period of presentation
D. All of the above
248. 10. Banks are required to do their reasonable care to B

verify that the documents submitted appear to be as
listed in the L/C. They are, however, under no oblig-
ation to confirm the ___________ of the documents
submitted
58 / 81
A. Quantity
B. Authenticity
249. 11. The L/C states the value is USD 20.000 per month B
for 8 months from May to December. Each month
the seller may draw up to USD20.000 and the issu-
ing bank will automatically reinstate it for another
USD20.000 for such 8 months.
In May, the seller only utilizes USD15.000, and then

the value of L/C in June increases to USD25.000. What
type of L/C is mentioned here?
A. Non-cumulative revolving L/C

B. Cumulative revolving L/C
C. Time revolving L/C
250. 12. Documents presented under L/C issued by Bank B

Global are fully complied. The issuing bank pays the
beneficiary, and the applicant has already made pay-
ment to his bank.
However, some days after, the applicant finds that the

goods are not in good quality. He goes to the issuing
bank and request the bank to refund such payment
for him. In this case:
A. The bank has to refund payment to the applicant

B. The bank has no obligation to refund payment
C. The bank has to ask for the opinion of the benefi-
ciary
251. 13. Because there are additional commitment of pay- A

ment from another bank, _______________ are more
expensive than ______________________
A. Confirmed L/C, unconfirmed L/C
B. Unconfirmed L/C, confirmed L/C
59 / 81
C. Revocable L/C, irrevocable L/C
D. Irrevocable L/C, revocable L/C
252. 14. Which type of L/C gives the seller greatest protec- B
tion?
A. Transferable L/C
B. Confirmed L/C
C. Standby L/C
D. Revocable L/C
253. 15. The L/C state: "Credit available with any bank, by A
negotiation for payment of beneficiary's draft at sight.
The L/C is subject to UCP600"
This is:
A. Irrevocable Negotiation L/C
B. Revocable Negotiation L/C
C. Irrevocable Straight L/C
D. Revocable Straight L/C
254. 16. L/C does not contain a confirmation request by B

the issuing bank. However, the beneficiary and the
advising bank make an independent agreement that
adds the advising bank's confirmation to a credit for
a fee. This is called:
A. Open confirmation
B. Silent confirmation
C. Straight confirmation
255. 17. Air waybill is a negotiable document B

A. True
B. False
256. 18. In documentary credit transactions, insurance B

document must be effective after date of loading of
the goods on board a transport vessel
A. True
B. False
257. B
60 / 81
19. Which document indicate that goods have been
checked/tested (typically according to a set of in-
dustry, customer, government's specifications) prior
to the shipment and the results of such checking/
testing?
A. Insurance certificate
B. Inspection certificate
C. Bill of exchange
D. Bill of lading
258. 20. If the goods are received in good condition, the A

carrier will issue ____________ to the shipper
A. Clean bill of lading
B. Claused bill of lading
C. Straight bill of lading
D. None of the others
259. 21. ____________________ is a notation on a bill of B

lading indicating that the goods have in fact been
shipped on a named vessel. This notation may be
made by the carrier, his agent, the master of the ship
or his agent.
A. "On deck"
B. "On board"
C. "On rail"
D. All of the others
260. 22. Which of the following statement is false about C

Ocean bill of lading?
A. It covers port -to - port shipment of goods (for
carriage of goods solely by sea)
B. It is a receipt for merchandise and a contract car-
riage between the shipper and carrier
C. If it is shipper's order bill of lading, it is a non-ne-
gotiable document to the goods.
D. None of the others
261. 23. The letter of credit requires to present an insur- B

ance certificate which covers for 110 pct value of the
goods. If the commercial invoice value is EUR50,000,
61 / 81
the insured value on insurance certificate must be:
A. 50,000EUR
B. 55,000EUR
C. 5,000EUR
D. 55,000 USD
262. 24. A letter of credit requires to present bill of lading A

and Insurance certificate. If the shipment date of bill
of lading is 20 May 2019, which of following insurance
certificate can be matched with such bill of lading?
A. An insurance certificate which show date of issue
is 20May2019
B. An insurance certificate which shows date of issue
is 21May2019
C. A cover note which shows date of issue is
20May2019
D. A cover note which shows date of issue is
21May2019
263. 25. Letter of credit requires shipment of following D

goods:
- Name of commodity: Fridge
- Quantity:
+ Model 123AX: 05 units - unit prices 5000 USD/unit
+ Model 126XQ: 08 units - unit prices 4000 USD/unit
- Partial shipment is prohibited
A commercial invoice presented by the beneficiary

shows:
+ Model 123AV: 05 units - unit prices 5000 USD/unit
+ Model 126XQ: 10 units - unit prices 4000 USD/unit
+ Model 245ZA: 01 unit - unit prices 2500 USD/unit
Whic of the following is the discrepancy(ies) in the

presented invoice?
A. Invoice shows fridge model 245ZA which is not

required in the L/C
B. Invoice shows fridge model 123AV which is differ-
62 / 81
ent from model 123AX in L/C
C. Invoice shows over-shipment for fridge model
125XQ (10 units instead of 08 units)
D. All of the above are discrepancies
264. 26. Which type of documents is illustrated below? C

A. Ocean bill of lading
B. Multimodal bill of lading
C. Charter party bill of lading
265. Which fom of credit might enable a beneficiay to B

obtain pre-shipment financing without impacting on
their credit facility?
A Transferable LC
B Red Clause LC
C Confimed LC
D Standby LC
266. The buyer and seller agree that goods will be shipped A
on a continuing basis (i.e USD10,000.00 per month
from Januay to June 2020. They do not want to estab-
lish individual L/C for each shipment. Which type of
L/C should they use in this case?
A Revolving L/C
B Transferable L/C
C Back to back L/C
D Standby L/C
267. Which type of L/C is often called 'non-pefoming L/C" D

because they are only used as a backup payment
method if the collection in a pimay payment method
is past due?
A Transferable LC
B Back to back L/C
C Red clause L/C
D Standby L/C
268. Transferable L/C can be transfered in.................... C

A in whole only
63 / 81
B in part only
C either in whole or in part
D None of these
269. ........................means a definite undetaking of the con- A

fiming bank, in addition to that of the issuing bank, to
honour/pay or negotiate a complying presentation.
A Confimation
B Acceptance
C Amendment
D Issuance
270. The L/C states: "Credit available with Issuing bank, C

by payment of beneficiay's draft at sight. This L/C is
subject to UCP600."
This is a(an):
A Irevocable Negotiation L/C
B Revocable Negotiation L/C
C Irevocable Straight L/C
D Revocable Straight L/C
271. L/C does not contain a confimation request by the is- B

suing bank. However, the beneficiay and the advising
bank make an independent agreement that adds the
advising bank's confimation to a credit for a fee. This
is called:
A Open confimation
B Silent confimation
C Straight confimation
D None of these
272. The L/C states the value is USD20.000 per month for 8 B
months from May to December. Each month the seller
may draw up to USD20.000 and the issuing bank
will automatically restore it for another USD20.000
for such 8 months. In May, the seller only utilizes
USD15.000, and then the value of L/C in June increas-
es to USD25.000. What type of L/C is mentioned here?
A Non-cumulative revolving L/C
64 / 81
B Cumulative revolving L/C
C Red clause L/C
D Standby L/C
273. A letter of credit requires to present Bill of lading A

and Insurance cetificate. If the shipment date of bill
of lading is 20May2020, which of following insurance
document can be matched with such bill of lading?
A An insurance cetificate which show date of issue is
20May2020
B An insurance cetificate which shows date of issue
is 21May2020
C A cover note which shows date of issue is
20May2020
D A cover note which shows date of issue is
21May2020
274. Which document indicate that goods have been B

checked/tested (typically according to a set of in-
dusty, customer, govenment's specifications) pior to
the shipment and the results of such checking/test-
ing?
A Insurance cetificate
B Inspection cetificate
C Cetificate of oigin
D Bill of lading
275. If the goods are not received in good condition (ex- B

ample: the packaging is damaged), the caier will issue
...................to the shipper.
A Clean bill of lading
B Claused bill of lading
C Straight bill of lading
D None of these
276. In transactions involving a letter of credit, which of B

the following is FALSE for commercial invoice?
A. Desciption of the goods in the commercial in-
voice must corespond precisely with the desciption
of goods in the documentay credit.
65 / 81
B. The invoice must not be made out in the same
currency with the currency of the L/C.
C. The invoice must be issued by the beneficiay.
277. .............. is a transport document covering B

port-to-port shipments of goods issued by a party
chartering a vessel.
A Air waybill
B Chater paty bill of lading
C Ocean bill of lading
D Multimodal bill of lading
278. Transferable L/C can be transfered more than once F

time. It means that a second beneficiay can transfer
to a third beneficiay.
T/F
279. According to UCP600, the issuing bank has 07 bank- F

ing days following the day of presentation in which to
detemine if the documents comply.
T/F
280. In documentay credit transactions, insurance docu- F

ment must be effective after the date of loading of the
goods on board a transpot vessel.
T/F
281. Which of the following L/C bings most secured for the C
beneficiay?
A Revocable L/C
B Irevocable L/C
C Irevocable confimed L/C
D Irevocable unconfimed L/C
282. Which tem can the intemediay/broker change from D

the oiginal L/C when transfeing L/C?
A Unit pice
B Amount of the L/C
C Peiod of presentation of documents
D All of these
66 / 81
283. Which of following statement is INCORRECT for a bill D

of lading?
A Bill of lading is a document issued by a caier to a
shipper
B Bill of lading is a witten evidence regarding receipt
of the goods (cargo)
C Bill of lading plays the role of a contract of caiage.
D Bill of lading plays the role of a contract of insur-
ance.
284. Which transpot document contains the following ele- A

ments?
- An indication that the bill of lading is subject to a
chater paty
- A signature or authentication by the ship's master
or owner, or agent for or on behalf of either the ship's
master or owner
- Unless othewise stated in the documentay credit,
does not name the caier
A A Chater paty Bill of lading
B A Non-negotiable Sea waybill
C Multimodal transpot document
D Couier receipt
285. A multimodal transpot document is a bill of lading A

coveing ...........
A. Two or more modes of transpot, for example ship-
ping by rail and by sea.
B. Two or more means of transpot, for example ocean
vessel A and ocean vessel B
C. Only sea transpot
D. Only air transpot
286. A packing list is a document prepared by the ...... A

listing the kinds and quantities of merchandise in a
paticular shipment.
A Shipper/Expoter
B Consignee/Impoter
67 / 81
C The banks
D The customs broker
287. The type of L/C considered as a means of funding for A

expoters:
A Red clause credit
B Revolving credit
C Standby credit
D Transferable credit
288. Which type of letter of credit L/C is descibed as fol- A

lows:
- It is used by traders to make payment to the ultimate
supplier.
- A trader receives a L/C from the buyer and then
opens another documentay credit in favor of the ul-
timate supplier.
- The first documentay credit is used as collateral
for the second credit. The second credit makes pice
adjustments from which comes the trade's profit.
A Back-to-back letter of credit
B Confimed letter of credit
C Revolving letter of credit
D Standby letter of credit
289. L/C requires the beneficiay to present Bill of lading C

and Insurance cetificate. After shipment, the benefi-
ciay presented Bill of lading which indicates:
- Port of loading: Hai Phong port, Vietnam
- Port of transshipment: Shanghai, China
- Port of discharge: Rotterdam, the Netherlands
Which of the following Insurance cetificate will be
matched with such Bill of lading?
A Insurance cetificate covers for risk from Hai Phong
port, Vietnam to Shanghai, China only
B Insurance cetificate covers for risk from Shanghai,
China to Rotterdam, the Netherlands only
C Insurance cetificate covers for risk from Hai Phong
port, Vietnam to Rotterdam, the Netherlands
68 / 81
D Insurance cetificate covers for risk from Rotterdam,
the Netherlands to Califonia, the United States
290. Which is false about Confimed letter of credit? C

A It is more secured for the seller than unconfimed
letter of credit because it adds the guarantee of a
second bank to that of the issuing bank.
B The cost of using confimed letter of credit is often
expensive than unconfimed letter of credit.
C It is often used when the seller has confidence
that the buye's bank (i.e issuing bank) can effectively
guarantee payment.
291. Which of following document is a title document to B

the goods?
A A straight bill of lading
B A shipper's order bill of lading
C A non-negotiable sea waybill
D An air waybill
292. In ............., the issuing bank is obligated to pay the B

beneficiay based on the nonpefomance of the appli-
cant. It means that it is generally obtained and paid
out as a result of noncompliance with some underly-
ing contract between the paties involved.
A Revolving L/C
B Standby L/C
C Transferable L/C
D Confimed L/C
293. Which of the following document covers port-to-port B

shipment, and it is not a title document, not nego-
tiable and cannot be endorsed?
A Chater paty bill of lading
B Non-negotiable sea waybill
C Maine/ocean bill of lading
D Packing list
294. A notation on a bill of lading which indicates that the A

goods have actually loaded on or shipped on a name
69 / 81
of vessel is called:
A "On board" notation
B "On deck" notation
C "Up board" notation
295. This invoice is cetified in the county of expot by a B

local consul of the county for which the merchandise
is destined. To get this document, it often takes time;
therefore, it should be considered by both buyer and
seller when this document is required.
A Commercial invoice
B Consular invoice
C Pro-foma invoice
D All of these
296. L/C indicates "About 5 tons of sugar at unit pice A

USD200 per ton". What is the maximum amount that
could be drawn under this L/C?
A USD 1100
B USD 1050
C USD 1000
D USD 1025
297. Which is false about Ocean Bill of lading? B

A It is a transpot document coveing port to port ship-
ment of goods (for caiage of goods solely by sea)
B It has an indication that the documents is subject
to a chater paty
C It has an indication that the goods have been
loaded "on board" or shipped on a named vessel.
298. In most case, a draft accepted by a company enjoys A

............credit standing than a draft accepted by bank.
A. Higher
B. Lower
C. none of the above
299. Which is the internationally recognized codification C

of rules unifying banking practice regarding letter of
credit?
70 / 81
A. URC 522
B. URC 600
C. UCP 600
D. All of these
300. In documentary collections, the party that signs or D

accepts the drafts is:
A. the advising bank
B. the exporter
C. the issuing bank
D. the importer
301. Which of these is the correct order in the documen- B

tary credit (L/C) cycle?
A. Beneficiary ships the goods, the applicant re-
quests his bank to issue the L/C, the beneficiary pre-
sents documents to claim payment from the issuing
bank
B. The applicant requests his bank to issue the L/C,
beneficiary ships the goods, and the beneficiary pre-
sents documents to claim payment from the issuing
bank
C. Applicant ships the goods, the applicant requests
his bank to issue the L/C, the beneficiary presents
documents to claim payment from the issuing bank
D. Beneficiary requests his bank to issue the L/C, ben-
eficiary ships the goods, and the beneficiary presents
documents to claim payment from the issuing bank
302. X Company Ltd is a Germany exporter and they sub- A

mits the collection documents to his bank (AAA Bank
JSC) with a collection order for payment from the
buyer Y Company Ltd in Hongkong. In this case, who
is the principal?
A. X Co Ltd
B. Y Co., Ltd
C. Both X Co Ltd and Y Co., Ltd
D. AAA Bank JSC
303. C
71 / 81
.......................describes the procedure for the sell-
er's shipping of goods, the transfer of documents
from the seller to the buyer through the banks, and
the transfer of payment from the buyer to the seller
through the banks.
A. Issuance
B. Amendment
C. Utilization
D. Settlement
304. If a time draft is accepted by a buyer of merchandise, D

it is called a ____________.
A. bank draft
B. promissory note
C. banker's acceptance
D. trade acceptance
305. In a documentary collection transaction, the banks F

must examine the documents in detail to ensure that
such documents are complied with terms and condi-
tions in the sales contract.
T/F
306. The URC 522 is applied worldwide, but it is not T

mandatory that a collection instruction incorporate
these rules.
T/F
307. A draft due at a future date or after a specified period C

of time that has been signed by the buyer is called:
A. Sight draft.
B. Banker's acceptance.
C. Trade acceptance.
D. All of these.
308. The collecting bank is the party that: A

A. Presents the documents to the buyer and collects
cash payment or promise to pay in the future from the
buyer in exchange for the documents.
B. Presents the documents to the seller and collects
72 / 81
buyer in exchange for the documents.
C. Presents the documents to the seller and collects
seller in exchange for the documents.
D. Presents the documents to the buyer and collects
seller in exchange for the documents
309. Regarding to documentary collection, which state- A

ment is correct?
A. For buyer, risk is incurred when the goods shipped
by the seller are not the quality or quantity ordered.
B. Banks involved in the transaction always guaran-
tee payments.
C. The seller will receive payment from the collecting
bank as long as they present complied documents.
D. There is no risk for seller if using documentary
collection.
310. Which of the following is not the main party to a B

Documentary Collection?
A. The Remitting Bank
B. The Insurance company
C. The Drawee
D. The Principal
311. In international transactions, the collection order is D

submitted by the exporter to his bank:
A. before the shipment of goods
B. before the sales contract is signed between the
exporter and importer
C. when the importer received goods
D. after the shipment of goods
312. Regarding documentary collection method, which of C

the following statement is INCORRECT?
A. For the sellers, they assume risk while the goods
are in transit or in storage until payment or accep-
tance takes place.
73 / 81
B. For buyers, risk is incurred when the goods
shipped by the seller are not the quality or quantity
ordered.
C. The seller will be totally assured to receive pay-
ment from the banks if he presents complied docu-
ments.
D. Documentary collections are easier to use than
letters of credit, and bank charges are usually lower.
313. Which of the following sentences is not types of col- D

lections ?
A. Documents against acceptance
B. Documents against payment
C. Acceptance documents against payment
D. Payment notes
314. The beneficiary under a letter of credit is often: D

A. the bank opening the credit
B. the customer of the opening bank.
C. the confirming bank.
D. the exporter.
315. A documentary credit is the written promise of a A

bank, undertaken on behalf of a ______, to pay a
______ the amount specified in the credit provided
the seller complies with the terms and conditions set
forth in the credit.
A. buyer, seller
B. seller, buyer
C. seller, bank
D. buyer, bank
316. When receiving the letter of credit from the advising A

bank, if the beneficiary finds that conditions of the
credit have to be modified, the seller should contact
the buyer immediately. So the buyer can instruct the
.......to make the necessary amendments.
A. issuing bank
B. advising bank
74 / 81
C. negotiating bank
D. remitting bank
317. Who has to deposit to open importing L/C? D

A. The advising bank
B. The seller
C. The issuing bank
D. The buyer
318. Which of the following parties will honor the draft as A

long as the documents are complied with terms of
the letter of credit, regardless of the conditions of the
goods received?
A. The issuing bank
B. The beneficiary
C. The insurance company
D. The collecting bank
319. Which one of the following International Chamber A

of Commerce (ICC) Publication's governs dealing in
documentary collections?
A. URC522
B. UCP600
C. URR725
D. ISP98
320. Which of the following statements about Time drafts A

is correct ?
A. Which are payable at a future fixed date or deter-
minable date
B. Which are payable immediately when presented
C. Which are payable immediately when buyer's bank
has a request from seller
D. Which are never paid by the buyer
321. Under letter of credit, who is responsible of preparing B

and presenting documents in accordance with the
terms of the documentary credit?
A. Applicant
B. Beneficiary
75 / 81
C. Confirming bank
D. Advising bank
322. The issuing bank checks the documents presented A

by the beneficiary under a letter of credit. If there is
a difference between the documents and the letter of
credit, it will be called as:
A. Discrepancy
B. Distinction
C. Definition
D. Depreciation
323. In documentary credit, when an issuing bank deter- B

mines that a presentation of documents is complying,
it must honor its undertaking to make settlement to
the ..................
A. Applicant
B. Beneficiary
C. Insurance broker
D. Insurance agency
324. Which of the following statements is true: C

A. URC 522 automatically governs all collections.
B. URC 522 takes precedence over local laws and reg-
ulations in relation to the operation of documentary
collections.
C. Banks can decide whether they wish to handle any
collection instruction they receive on a case-by-case
basis.
325. An exporter agrees to sell a container of a certain B

type of merchandise for EUR 10,000 (ten thousand)
CIF Incoterms 2010. The exporter is aware that under
CIF terms he must insure the goods properly. The
minimum insured value shoud be:
A. 9,000 EUR
B. 11,000 EUR
C. 1,000 EUR
D. 10,000 EUR
76 / 81
326. Incoterms specify the rights and responsibilities of D
the parties principally in what type of international
contract?
A. Contract of insurance
B. Contract of carriage
C. Shipping contract
D. Sale contract
327. Which contract clause protects both sides in the C

event that there is an unforeseeable event (some-
times called an "Act of God") which prevents one of
them from fulfilling the contract?
A. "Choice of law" clause
B. "Liquidated damages" clause
C. "Force majeure" clause
D. "Insurance" clause
328. Which of the following statements best describes C

Incoterms 2010?
A. Incoterms 2010 are a set of binding international
laws that have global application in contracts of sale
between exporters and importers
B. Incoterms 2010 are international commercial reg-
ulations that become effective with enforcement by
individual governments around the world.
C. Incoterms 2010 are a set of rules applying to the
contract of sale which become effective by voluntary
incorporation into the sales contract.
329. In Incoterms 2010, the place of delivery is always the F

place of destination of the goods.
T/F
330. Which of these Incoterms represents the LEAST re- D

sponsibility for the exporter?
A. CIF
B. DAT
C. DDP
D. EXW
77 / 81
331. Similar to letters of credit, banks in documentary F
collection method will always guarantee payment for
the seller.
T/F
332. Which of the following is not the main party to a C

Documentary Collection?
A. The Collecting Bank
B. The Principal
C. The Advising bank
D. The Drawee
333. Under this group of Incoterms 2010, the point of de- C

livery (transfer of risk) from the seller to the buyer
is at the point of shipment. However, this group ex-
tends the seller's obligation with regard to the cost
of carriage and insurance (if any) up to the point of
destination. Which group is mentioned here?
A. Group E term (EXW)
B. Group F terms (FCA, FAS, FOB)
C. Group C terms (CFR, CIF, CPT, CIP)
D. Group D terms (DAT, DAP, DDP)
334. Which of the following is NOT covered under In- D

coterms?
A. Transfer of title of the goods
B. Payment terms/methods
C. Task, cost and risks of buyer and seller associated
with the transportation and delivery of goods
D. Both Transfer of title and Payment terms/methods
335. A Vietnamese exporter is delivering goods from Noi B

Bai Airport, Vietnam for air shipment to Berlin Airport,
Germany; and the air freight and insurance coverage
is to be arranged for and paid by the importer. The
correct Incoterms rule in such circumstances would
be:
A. DDP Berlin Incoterms 2010
B. FCA Noi Bai Airport Incoterms 2010
78 / 81
C. FOB Noi Bai Aiport Incoterms 2010
D. CPT Berlin Incoterms 2010
336. Which of the following Incoterms does the buyer D

arrange and pay the cost for main carriage?
A. DDP
B. DAP
C. CIP
D. FCA
337. In collection method, the bank that is responsible A

for making the documents available to the drawee is
known as:
A. the presenting/collecting bank
B. the advising/notifiying bank
C. the remitting bank
D. the issuing bank
338. The seller may be acting as a (an) __________and C

be unable to ship the goods before making payment
to his supplier, or the seller may be unable to make
payment before getting paid himself.
A. Importer
C. Broker
D. Bank
339. An United States exporter ships goods with value A

of USD 300.000 to a Vietnamese importer. Payment
must be made in USD. At the time of shipment, 1 USD
= 23.000 VND. However, at the time of payment (i.e,
60 days after shipment date), the exchange rate has
changed to 1 USD = 22.000 VND. In this case, who gets
the benefit of currency fluctuation?
A. A Vietnamese importer
B. An United States exporter
C. A broker
D. None of these
340. In a documentary credit, the ____________specifies B

the documentation required from the _________be-
79 / 81
fore the __________ is to make payment, and the sell-
er is given assurance that payment will be made after
shipping the goods as long as the documentation is
in order.
A. seller, buyer, bank
B. Buyer, seller, bank
C. bank, seller, buyer
D. Buyer, bank, seller
341. Which is the most important factor considered before A

deciding on a method of payment?
A. Relationship between the seller and the buyer
B. Nature of the merchandise
C. Political stability in either or both countries
D. The potential for currency fluctuation
342. This category of Incoterms requires seller to bear all D

costs and risks needed to bring goods to place of
destination.
A. E terms
B. F terms
C. C terms
D. D terms
343. An exporter (including his factory, warehouses) is C

in Hong Kong; and an importer is in UK. Which of
these Incoterms could be applied in the sales con-
tract signed between them?
A. CFR Hong Kong
B. FOB London
C. CIF London
D. EXW London
344. The best way to control the results of your contract A

is...
A. To clarify each party's responsibility in the agree-
ment
B. No discussion with your partner(s)
C. Give full control to the counterpart
D. Writing the contract in other party's language
80 / 81
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1. 101. CURRENCY OF THE TRANSACTION is that a

2. 102.The cost and particulars of ________ will be of b

3. 103. Payment by ________ requires that the buy- d

4. 104. _________________________is a bank's b

5. 105. When___________is issued by the buyer's bank b

6. 106. The ______________ bank is instructed not to d

7. 107. A__________________________________is sim- a

8. 108. ______________________ payments are made b

9. 109. In a documentary credit, the ____________spec- b

10. 110. Purchase on____________________means that a

11. 111. In a sales contract between a seller and a buy- a

12. 112. There are many ways of dealing b

13. 113. A trader can reserve a future foreign currency a

14. 114. In documentary credit, upon receiving a

15. 115. If the conversation of currency occurs on the d

16. 116. If a seller receives a letter of credit in a foreign c

17. 117. A____________________________in internation- a

18. 118. Many organizations around the world provide b

19. 119. Incoterms don't show which aspect as below c

21. 121. A United States exporter is delivering goods a

22. 122. ________________________acceptances often d

23. 123. BAnkers acceptances are generally short-term, a

24. 124. In documentary collections, banks b

25. 125. Which party prepares documentation (collection a

26. 126. _______________________________receives b

27. 127. _____________________is the party that makes d

28. 128. Basic Documentary Collection Procedure in- d

29. 129. The__________________bank sends the doc- c

30. 130. The presenting (collecting) bank in a documen- d

31. 131. The____________________________bank may a

32. 132. Which method of payment is that the collecting a

33. 133. The banks involved in a

34. 134. In which of the following case may the seller a

35. 135. A______________________________is the writ- a

36. 136 In a________________________________, banks b

37. Which type of letter of credit (L/C) cannot be can- b

38. 138. Although_______________________provide c

39. 139. The Uniform Customs and Practice for Docu- a

40. 140. ___________________________initiates the doc- a

41. 141. Upon instructions from the buyer, b

42. 142. Which party receives notification (advice) of d

43. 143. ________________________describes under a d

44. 144. __________________usually sends the original b

45. 145. The_________________________will examine c

46. 146. ___________________________refers to the d

47. 147. _________________________________is the c

48. 148. Means of settlement are a

49. 149. In an unconfirmed credit, which of following b

50. 150. How many methods of hedging are there? c

51. 151. When the reputation of the issuing bank is strong a

52. 152. In documentary credit ______________________ a

55. 155. The confirming bank does not c

56. 156. The issuing bank of a letter of credit does not: c

57. 157. Payment under an irrevocable documentary e

58. 158. In dealing with a readily identifiable issuing bank a

59. 159. An irrevocable unconfirmed documentary credit a

60. 160. _________________________are often called a

61. 161. ________________________has a special clause b

62. 162.____________________is one where the original a

63. 163. What is a new credit opened on the basis of an d

64. 164. ______________________________is an obliga- d