IB-Chpt10-Exporting, Importing, and Countertrade

What is one reason firms engage in exporting?

• To reduce market size

• To limit competition

• To increase market size and profits

• To avoid trade barriers

Which organization is the most comprehensive source of export information for U.S. firms?

• The U.S. Department of Commerce

• The International Trade Administration

• Local and state governments

• The Small Business Administration

What is a common pitfall of exporting?

• Excellent market analysis

• Strong understanding of competitive conditions

• Poorly executed promotional campaigns

• Effective distribution programs

What is an Export Management Company (EMC)?

• A firm that acts as the export marketing department for client firms

• A government agency that regulates exports

• A financial institution providing loans for exports

• A company that only exports goods

What is a letter of credit?

• A type of export insurance

• A contract for local production

• A document that guarantees payment to the exporter

• A bill of lading

What is countertrade?

• A method of financing exports

• A range of barter-like agreements

• A type of export management

• A form of international trade regulation

Which of the following is a form of countertrade?

• Trade events

• Market analysis

• Export financing

• Barter

What is a common risk associated with exporting?

• High local demand

• Excessive paperwork

• Foreign-exchange risk

• Low competition

What does a draft in international commerce refer to?

• An order for payment

• A type of export document

• A market analysis report

• A shipping contract

What is one of the pros of countertrade?

• It requires no local partnerships

• It eliminates the need for paperwork

• It provides a way to finance an export deal

• It guarantees high-quality goods