Which of the Following Is a Reason Why Commercial Banks

question 7

Multiple Choice

Which of the following is a reason why commercial banks may facilitate international trade?

• A)The exporter may not wish to accept the credit risk of the importer.
• B)The government may impose foreign exchange controls that prevent payment by the importer to the exporter.
• C)The exporter may need financing until payment for the products is received.
• D)All of the above

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Definitions:

Sales Price

The financial value assigned to a product or service available for purchase in the market.

Variable Costs

Costs that vary directly with the level of production or sales volume, such as raw materials and direct labor expenses.

Variable Cost

Expenses incurred by a business that vary directly with the level of production or sales volume, such as cost of goods sold.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time, used to assess the profitability of investments.