Microeconomic Test

International Payment

Key to questions for tutorial week 5

1. Which type of Collection used when the exporter send commercial documents including transport documents directly to the importer by mail and send a B/E through banking system to present to the importer?

2. Company A in Vietnam sell garment products to a company in Angolia, payment term is documentary collection. After shipment, company A prepare documents and send them to VCB, this bank because has no relationship with any bank in Angolia, send them to its correspondent bank HSBC in Hongkong. HSBC then send them to its correspondent bank North Star in Angolia. North Star send the documents to its client which signed garment contract with company A in Vietnam.

Which bank is Sending bank? Which bank is Collecting bank? Which bank is Collecting bank?

3. In a collection, the principal is

|a. the importer |b. the importer’s bank |c. the exporter |d. the exporter’s bank |

4. When the exporter and importer agree that payment term to be documentary collection, the documents will be sent to which of the following parties

|a. the Sending bank |b. the Collecting bank |c. the importer |d. sent together with the goods |

5. Centro International Handels Bank (Vienna, Italy), acting as a remitting bank, has sent for collection to its correspondent bank Indosuez Bank (Jakarta, Indonesia) a collection instruction amounting to USD 500,090 specifically stating that the documents may only be released against payment at sight. Although the instructions were clearly understood by the collecting bank (proof of this exists from the collecting bank's acknowledgement), it released the documents to the drawee without having received payment from the drawee and without any written notice to the sending bank regarding its action. In addition to this, as the B/L was made to the order of the collecting bank, this bank endorsed it...