An irrevocable letter of credit ________.
A)is issued by a global credit agency
B)is the basis for multilateral credit netting
C)can be amended only if all parties involved agree
D)obligates the exporter's bank to pay interest to the importer

Question

Quizplus · Accepted Answer

An irrevocable letter of credit cannot be amended or cancelled without the agreement of all parties involved. This provides a level of security to both importers and exporters, as the terms of the letter of credit cannot be unilaterally changed. Options A, B, and D are incorrect: an irrevocable letter of credit can be issued by any bank, it is not related to multilateral credit netting, and it does not obligate the exporter's bank to pay interest to the importer.

An Irrevocable Letter of Credit ________