Fact Pattern 9-1

question 33

Multiple Choice

Fact Pattern 9-1
First State Bank issues a letter of credit in favor of Whirlwind Instruments Company, an American firm, to facilitate an international sales contract to buy resources from Lapland Mining, Ltd., a Finnish company.
-Refer to Fact Pattern 9-1. In a letter of credit, the beneficiary is

• A) Lapland.
• B) Whirlwind.
• C) First State Bank.
• D) none of the choices.

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Definitions:

Bond Issuer

A bond issuer is an entity, such as a corporation, government, or municipality, that raises funds by issuing bonds to investors, in return for borrowing money over a specified period at an agreed interest rate.

Promissory Notes

Written, legally binding promises to pay a specified sum of money at a defined future date.

Installment Notes

A form of debt or loan that is paid back in regular, periodic installments, often including both principal and interest.

Principal

The original sum of money borrowed in a loan or invested, excluding any interest or dividends.