The International Chamber of Commerce (ICC) publish a list of commercial rules known as Inco- terms. What is the purpose of these rules?
Answer(s): C
Incoterms describe the point at which an item is considered 'delivered' and explains who has the risk of what during the transport of the goods.
Which of the incoterms listed are suitable for transporting goods via train?
Answer(s): D
EXW- exworks is a suitable incoterm for transporting goods both by rail and boat. It can be used regardless of the mode of transport. The other three are for transport over water. P. 143 Shipping Incoterms: the Complete Guide - Guided ImportsSome students report a lot of questions on Incoterms in the exam, some say they only had 1. Best bet is to learn them if you possibly can.
What is a major benefit to using Incoterms when sourcing goods internationally?
Incoterms can replace lengthy contract clauses as they replace the need for contracts to detail which party is responsible for organising transport, paying duties, having the insurance etc. Incoterms is an odd one for exam topics- some students say it was a huge part of their exam and there were many questions on this. Others said there were just one or two. Questions get randomly assigned from the bank so it's completely random how many you'll get on this topic.
Which of the following payment mechanisms is most beneficial to the supplier?
Answer(s): B
cash in advance is the most beneficial to a supplier.Open account /credit account is the most beneficial to the buyer. Learn this as it's a known exam topic.
When using a 'credit account' payment mechanism, when does a supplier receive payment for the goods?
Answer(s): A
In a 'Credit Account' payment mechanism- the supplier receives payment after the goods are delivered, in line with agreed payment terms (which may be 30 days or something like that).
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