When companies do business in developing nations and lack access to hard currencies, which of the following tools are these companies most likely to make extensive use of?
A) foreign exchange
B) goodwill payment schedules
C) countertrade
D) accumulated bank reserves

Question

Quizplus · Accepted Answer

Countertrade is a commonly used tool by companies that lack access to hard currencies when doing business in developing nations. Countertrade refers to the practice of exchanging goods and services for other goods and services rather than for currency. This allows companies to bypass the challenge of currency conversion and gain access to needed resources in developing nations. Foreign exchange, goodwill payment schedules, and accumulated bank reserves may also be used in these situations, but are less common or effective compared to countertrade.

When Companies Do Business in Developing Nations and Lack Access