For an Importer, What Is a Disadvantage of Using a Letter

question 54

Multiple Choice

For an importer, what is a disadvantage of using a letter of credit for international transactions?

• A) It results in the importer losing control over the process of trading.
• B) It reduces the exporter's level of trust in the importer.
• C) It reduces the importer's ability to borrow funds for other purposes.
• D) It requires the importer to repay the loan even before the merchandise is sold.
• E) It is not issued at the importer's request.

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Definitions:

Energy Waves

Oscillations that transfer energy from one place to another, such as sound waves, light waves, or electromagnetic waves.

Hydrolysis Reactions

Hydrolysis reactions involve the chemical breakdown of a compound due to its reaction with water.

Dehydration

The condition that results when the body loses more water than it takes in, leading to insufficient water to carry out normal functions.

Synthesis

The process of combining different elements or components to form a complex whole, often used in chemistry and biology.