The Primary Methods of Payment for Foreign Trades,ranked in the Order

question 74

Multiple Choice

The primary methods of payment for foreign trades,ranked in the order of most secure to least secure for the exporter is

• A)open account,consignment,letter of credit/time draft,and cash in advance.
• B)consignment,letter of credit/time draft,cash in advance,and open account.
• C)cash in advance,letter of credit/time draft,consignment,and open account.
• D)cash in advance,letter of credit/time draft,open account,and consignment.

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Definitions:

Efficient Frontier

A graph representing the set of portfolios that provides the highest expected return for a defined level of risk or the lowest risk for a given level of expected return.

Capital Market Line

A line that depicts the risk-reward profile of investable assets, showing the rate of return for varying levels of risk, based on the market risk premium and the risk-free rate.

Minimum-Variance Point

The point on a portfolio's efficient frontier at which the portfolio has the lowest level of volatility or risk for its level of expected return.

Zero Correlation

A statistical measure indicating that two variables do not move in tandem and their relationship is completely random.